TaxTMI 
TaxTMI 
1983 (8) TMI 260
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....s an appeal having been received by transfer under Section 35P of the Central Excises and Salt Act, 1944), the appellants have been paying excise duty on their annual production till the issuance of Notification No. 71/78-C.E., dated 1-3-1978 whereunder they claim to have become eligible for total exemption from duty by fulfilling the conditions of the said Notification; namely, their clearances not exceeding Rs. 5 lakhs from year to year. 2. It is stated that this unit is owned and managed by a proprietary concern; namely, Hind Ceramics Limited, situated in the same premises and that the said proprietary concern are manufacturing excisable goods of considerable value, all covered by Tariff Item 68, and since both the units are loca....
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....ts nor of the local departmental officers. 3. The departmental action, however, ensued as a sequel to this raid, to the effect that the goods having been seized, a Notice to show cause was issued as to why duty for all the clearances made in wrongfully availing of exemption should not be levied. This notice was eventually confirmed by an order dated 7-9-1981, passed by the Collector of Central Excise, Meerut whereby he determined the duty liability at Rs. 65,817.63 and confirmed the demand thereof and also holding it to be a case of deliberate evasion of duty, imposed a penalty of Rs. 5 lakhs. The seized goods were also ordered to be confiscated, though an option was given to redeem the same on payment of fine of Rs. 20,000. 4.&e....
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.... was a genuine case of bona fide ignorance of the amending Notification on their part. It was thus contended that there being no clandestine removal inasmuch as appellants themselves had been inviting visits of the local Excise Officers, and to that extent there was no attempt at concealment on their part, at the most the duty liability for six months, preceding the notice could be enforced and that the rest of the duty demanded was time-barred. The imposition of penalty was assailed on the plea of lack of mala fide on their part. 6. Shri J. Banerjee, Advocate appeared at the time of hearing, and reiterated all these pleas. He very fairly conceded that the duty liability itself was not disputed, and that the sole plea is that there ....
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....e characterised as venal. 7. The department was represented by Shri K.D. Tayal, SDR who made a short but emphatic reply repudiating the plea that there was no deliberate concealment of facts and contended that the appellants could not plead ignorance of the Notification, which was a statutory notification, and as a manufacturer was bound to come to their notice. He further pointed out that the Declaration to which the learned Counsel for the appellants had made reference was ambiguous and vague, inasmuch as that though the name of the proprietor was shown but the address was not indicated, nor was there any declaration about the other goods being manufactured by the said proprietary unit, and consequently the appellants could not pl....
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....cturer, under whom they were also operating, and that the said manufacturer was having more than one factory, producing excisable goods, and they went on clearing goods without payment of excise duty, after becoming liable to pay the same and did not discharge their duty liability for two years, and on their own showing would have continued to do so, but for this surprise visit by the officers of the Preventive Unit of Central Excise. 9. We are, thus, constrained to consider it to be a case of clearances having been effected without placing true facts before the Excise authorities and to that extent it has to be considered to be a case of clandestine removals, and in view of the standing of the appellants inasmuch as they were not n....