2012 (12) TMI 39 - AT - Central Excise

Appeal Granted for Duty Waiver on Capital Goods Transfer

The Appellate Tribunal granted the appeal seeking waiver of pre-deposit and stay of recovery for duty and penalty on capital goods transferred to another ... 100% EOU – demand of duty of Excise on certain capital goods which were claimed to have been transferred to another 100% EOU but found not to have been accounted for by the appellant - demand of duty is in respect of the capital goods mentioned in Annexures - II and III to the show-cause notice – Held that:- Many of the capital goods mentioned in the two annexures are covered by re-warehousing certificates issued by the proper officer having jurisdiction over the recipient unit M/s. Agro Dutch Industries Ltd. In respect of some other goods, the appellant has claimed that these goods were used, over a period of time, in the manufacture of larger equipments and that such larger equipments were re-warehoused in the recipient unit - there is no reference whatsoever to any specific re-warehousing certificates or other documents produced by the appellant. It just contains an account of the manner in which a 100% EOU must maintain the records - adjudicating authority should have endavoured to ascertain whether the assessee could reconcile the capital goods mentioned in Annexures - II and III to the show-cause notice with the re-warehousing certificates and other documents produced by them. This exercise, it appears, was not even attempted – matter remanded to Commissioner Issues:Appeal seeking waiver of pre-deposit and stay of recovery for duty and penalty. Adjudication of demand of duty on capital goods transferred to another Export-Oriented Unit (EOU) without proper accounting.Analysis:The appeal before the Appellate Tribunal sought waiver of pre-deposit and stay of recovery for a duty amount exceeding Rs.11 lakhs and a penalty of Rs.5 lakhs. Despite no representation from the appellant, the Tribunal noted a previous adjournment request. After reviewing the records and hearing the Deputy Commissioner, the Tribunal deemed the appeal suitable for summary disposal and proceeded after dispensing with pre-deposit.The appeal pertained to a 100% Export-Oriented Unit (EOU) challenging the demand of excise duty on capital goods transferred to another EOU without proper accounting. The appellant claimed that some goods were covered by re-warehousing certificates, while others were used in manufacturing larger equipment re-warehoused in the recipient unit. However, the memo of appeal lacked specific references to re-warehousing certificates. The Tribunal observed the absence of specific references in the impugned order to documents produced by the appellant, emphasizing the need for the adjudicating authority to reconcile the goods with the certificates and other documents. It concluded that the case should be re-adjudicated by the Commissioner to ensure a thorough examination of all relevant documents and a complete scrutiny of the goods covered by the show-cause notice.In the judgment pronounced in open court, the Tribunal highlighted the importance of a fresh adjudication in accordance with the law, providing the appellant with a reasonable opportunity to present evidence and be heard personally. It stressed the necessity of carefully examining all relevant documents to ascertain the proper accounting of the goods in question, with the new order expected to disclose a comprehensive scrutiny of the documents and reasons for the conclusion reached.