TaxTMI 
TaxTMI 
TaxTMI 
2018 (4) TMI 1021
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....Tarapur, the main noticee and also at various offices, godown and factories of weavers. The issues was that the main appellant, M/S DTPL, Tarapur had installed dyeing vessels and were clearing dyed texturized yarn received from M/s DPPL, Silvassa. During the course of searches various documents were recovered. Certain quantity of dyed yarn found in the factory premises were seized under panchanama. After scrutiny of records a show cause notice was issued alleging that M/s DTPL, Tarapur were engaged in aiding and abetting of texturized yarn received from M/S DPPL, Silvassa. The show cause notice was relying on various registers recovered from the premises of the warehouse keeper, namely, M/S Purohit clearing Agency, located in Bhiwandi. Statements of Shri Mohammed Aslam Khan, Supervisor of M/s DTPL was recorded and gate register was also recovered from M/S DTPL. From the scrutiny of the said gate register it was observed that there was frequent movement of vehicles between the factory and the factory in Silvassa. It was asserted that the movement of vehicles between factory at Tarapur and Silvassa was far in excess of the required for clearance of dyed yarn accounted for. In the sta....
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....vassa was pasted with packing slip contained details like, name, quality, weight batch No. carton No. The said slips on the box of dyed yarn were printed slips handwritten details. In a further statement of Shri B warilal recorded on 10/02/2001, he further confirmed that all the entries in respect of dyed yarn received from M/S DPPL, Silvassa, were entered in the note book No.31 and Register No. 28 of the Annexure 'A' to the panchanama. On the basis of aforesaid register recovered from the premises of Purohit Clearing Agency, an assertion was made that all the quantities of yarn entered in the said register are dyed yarn and Annexure 'A' to the notice was prepared as extract of the said register. The details of delivery order-cum-challan recovered from the files withdrawn at serial No. 33 and 35 of Annexure 'A' to panchanama dated 04/10/2001 was tabulated in Annexure 'B' to the notice. The file withdrawn at serial No. 34 Annexure 'A' to panchanama dated 04/01/2001 from the premises of Purohit Clearing Agencies containing copies of gatepasses of M/S DPPL, Silvassa issued for clearing goods outside the factory premises. 4. Statement of Shri Ra....
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....d in Register 28 and 3 1 and recovered from M/S Purohit Clearing Agency. 7. Learned Counsel for appellants argued that the notice allege that the appellants had manufactured in all 8.11 lakh kgs. of dyed yarn in their factory. He argued that it is not possible to manufacture such huge quantity of dyed yarn in their factory premises. He further argued that a trial was carried out in the month of May 2002 by Revenue, after issue of show cause notice. Learned Counsel referred to letter dated 16/05/2002 from Dy. Commissioner of Central Excise, Kalyan - I to the Commissioner of Central Excise, Mumbai 11 wherein certain data regarding manufacturing capacity was sent to the Commissioner. The said letter relied on the report of Range Superintendent and Divisional Officer. Subsequently, another study was undertaken by Superintendent Central Excise, Mumbai-Ill and vide letter dated 29/05/2002 the summary was sent to Joint Commissioner (Technical). Learned Counsel argued that on strength of these letters it can be easily be concluded that appellant did not have the capacity to manufacture such a huge quantity of dyed yarn in his premises. He further pointed out that they had sought cross-exa....
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....ement who had worked just form 8 days and was thus not competent to comment on the records pertaining to September 1999 to December 2000. 11. Learned Authorised Representative relied on the impugned order. He argued that there are common Directors of both M/s DTPL, Tarapur and M/S DPPL, Silvassa. He argued that the movement of vehicle between Tarapur and Silvassa plant was frequent. He argued that the number of trips were not justified by 20000 Kgs of yarn which was dyed on job-work basis. He further pointed out that number of inward movement of transport vehicles to Tarapur far exceed the outward movement of the vehicle from Tarapur. 12. Learned Authorised Representative relied on the statement of Shri Chandrashekhar Swamy, Commercial Manager of M/S DPPL, Silvassa. On examination of his statement, we find that there was no admission in his statement. The said Commercial Manager has only accepted that they had received 20683 kgs of dyed yarn from M/S DTPL, Tarapur under duty-paid invoices. Learned Authorised Representative relied on the statements of Shri Santosh L Pimple, Excise Clerk of M/S DTPL, Tarapur. We find that there is no admission in his statement as well. Learned Auth....
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....h. Thus, it is imperative that no reliance on the said statement can be placed as no cross-examination has been granted. 15. Moreover, it is seen that Revenue has alleged that appellant have manufactured about 8.11 lakhs kgs. of dyed yarn. The study report dated 16th May 2002 by Dye Commissioner of Central Excise, Kalyan - I relates to the manufacturing capacity of three units, other than appellant, in respect of machines installed in those units. The report dated 29/05/2002 of Superintendent (Technical), Mumbai - IIIsent to Joint Commissioner (Technical), Mumbai - III shows that the capacity to manufacture dyed yarn of M/S DTPL was approximately 32.5 tonnes at the most. It is seen that while calculating the capacity he has stated that the machine having capacity of 200 kgs. can be loaded with yarn up to 250 kgs yarn and he has also presumed that each batch of dying takes 4 to 5 hours and average of 5 batches can be taken per day. He has calculated the capacity for 26 working days per month and on that basis arrived at monthly production capacity of 32.5 tonnes per month. We find that there are lot of presumptions in the said calculations and if Revenue seeks to rely on the said r....