TaxTMI 
TaxTMI 
2019 (4) TMI 929
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....inished goods, it was found that some of the job workers and buyers were not traceable or existing or the sub job workers stated that they did not undertake the job work. The transporters whose statements were recorded refused transportation of the fabric. Based upon investigation it was alleged that the transaction of manufacture of fabric and its sale, receipt of consideration towards sale were mere paper transactions. No grey fabrics were manufactured from the yarn cleared without payment of duty and the yarn allegedly had not been used for manufacture of fabric but was diverted and sold elsewhere. The show cause demanded duty on such yarn and its confiscation along with imposition of penalty and penalty on all other appellants. The demand was raised by invoking extended period of limitation. An addendum to show cause notice was also issued on investigation conducted towards banking transactions shown to have done in relation to such job work activity of grey fabric and clearance thereof. The Appellant filed reply to said show cause notice on merits, Time bar as well as against the issue of addendum on merits. They also argued that since the show cause notice is deemed to be del....
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....AT-AHM, Slotco Steel products Pvt. Ltd. 2013 (157) ELT 193 (DEL.), Hi Tech Abrasives Ltd. 2018 (362) ELT 961( Chattisgarh) , J & K Cigarettes Ltd. 2009 (242) ELT 189 (Del.), Inter Metal Trade Ltd. 2014 (381) ELT 481 (TRI), Parmarth Iron Pvt. Ltd. 2010 (260) ELT 514 (All.). 3. He further submits that it is an accepted position that the yarn was received by the job workers. The job work records were found at the job workers premises. In case of M/s Mansa Textiles the statement of Shri Abhishek Singhal was recorded who stated that they have received POY for job work and manufactured fabrics. That though the SCN alleged that M/s A.A Textiles was found to be nonexistent during investigation, however it is to be seen that M/s A.A. Textiles was registered unit and its registration number was given to the department at the time of filing job work intimation. The reliance has been placed upon statement of one Shri Jayendrabhai Patel but he was not offered for cross examination. In case of Geena Synthetic, the department has claimed that the said unit did not have any weaving machinery at the given address. However Shri Rafiq Abdul in his statement has stated that yarn was texturized at hi....
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....annot specify whether the goods were purchased or received for job work. The SCN denied job work activity on the ground that no evidence of manufacturing could be found. 5. He submits that it cannot be said that no activity was undertaken by the manufacturer on the ground that no record of manufacture of goods on job work was found as the same is not required under Rule 12B. He submits that they had paid job work charge of more than 4,01,72,785/- which has not been disputed. The TDS was deducted on such amount. There is no allegation that such job work charges flowed back to the Appellant. That M/s Geena and M/s Rama Filaments were investigated in 2005 but the summon was issued in 2009 when the same returned as undelivered with remark "company close". The fabrics were cleared to 30 buyers on payment of duty whereas the department investigated or shown to have investigated only 4 buyers. Out of the 4 such buyers it was alleged that except Swastik Silk Mills no other buyers could be located. There is no evidence that the buyers could not be located. No statements are on record of any person to be found at the buyers address. That though the bank statements of 4 buyers i.e. Shree Te....
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....prior to April 2004. The payment has been made by M/s Swastik Silk Mills from their own bank account, which was deposited by the Appellants in their own account. The cross examination of Shri Surya Prakash Jaiswal of M/s Swastik Silk Mills to ascertain the truth was denied by the adjudicating authority. He submits that at no point of time, the payment of duty on grey fabrics was disputed by the Department and without such rejection, it cannot be alleged that no grey fabrics was manufactured by the appellant. No person has been found to whom yarn has been sold by the Appellant. Shri S.K. Singhal in his statement dated 16.12.2008 had given details of name and address of the broker, through which the grey fabric was sold. Six job workers have admitted delivering grey fabrics to the buyers, as per direction of the appellant. The transporters were not cross examined by the Department during adjudication and their statement cannot be formed basis for holding that the appellants have not delivered grey fabrics to the buyers. There is no evidence that supporting the allegation that the appellant has cleared yarns manufactured it under the guise of job work delivery. There are no whereabout....
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....stries V/s CCE, Allahabad - 2007 (218) ELT 242 (Tri, Del), CCE, Rajkot V/s Kalyan GlazeTiles - 2008 (222) ELT 417 (Tri, Ahmd), Nav Karnataka Steel Pvt Ltd V/s CCE, Belgaum - 2008 (225) ELT 454 (Tri, Bang.), Stilbene Chemicals Ltd V/s CCE, Vishakhapatnam - 2008 (227) ELT 94 (Tri, Bang), Kumar Cotton Mills Pvt Ltd V/s CCE, Ahmedabad - 2008 (229) ELT 273, Tri, Bang., Kumar Cotton Mills P.Ltd V/s CCE, Ahmedabad - 2008 (229) ELT 272 (Tri, Ahmd), CCE, Vadodara V/s Air Command India Ltd -2008 (230) ELT 152 (Tri, Ahmd), HG Entertainment Technology Ltd V/s CCE, Vapi - 2009 (233) ELT 431 (Tri, Ahmd), CCE &Cus., Surat -I V/s Finornic Chemicals (I) Pvt Ltd -2009 (237) ELT 84 (Tri, Ahmd), J.I. Gandhi Silk Mills V/s CCE,Surat -I 2009 (237) ELT 103 (Tri, Ahmd). He also submits that demands are time barred. They had given intimation to their own jurisdictional officers as well as to jurisdictional offices of job worker. The statement of senior manager was recorded on 23.12.2003 and SCN issued in June 2009. Thus, the Revenue was aware that even prior to the period of investigation, the appellants were getting grey fabrics manufactured on job work basis. He relies upon the Hon'ble Supreme Court judg....
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.... by some of the job workers. Statement of Shri Madhav Bhageria, JMD of the appellant agreed to have received cheques from M/s Shah Corporation and shown the said amount of cheques in the account of M/s Umiya Textiles. He has stated that they sent the yarn for job work and prepared the invoice of finished goods and sent them to their marketing office at Surat. Thus, the appellant has intentionally evaded the duty on yarn cleared to the job workers by resorting to suppression of facts or mis-statement. 10. He submits that the transporters Shri Hanuman Singh, Shri Narendra Govind Patel, Shri Vasudev Mishra and Shri Rajendra Jain said that no fabric was transported by them, sub-job workers M/s Satish Textiles and M/s M.M. Kapadia denied having done any job work. The sub job workers M/s Balaji Textiles, M/s Shakti Textiles, M/s Atlas Synthetics were not found to be existents. That M/s Rama Filament do not have machines to manufacture fabrics. The summons were issued to the buyers to whom fabrics manufactured by the job workers were cleared were returned undelivered. M/s Swastik Silk Mills, one of the buyers, denied having purchased any fabrics from the Appellant. He thus supports the ....
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....exed to the appeal and thus it remains undisputed that the Department was in knowledge of the job work activities. While sending the goods the challans were prepared and the yarn was acknowledged by the job worker of having been received. The Appellant has paid job work charges to the said job workers and also deducted TDS on such payments as found from Form No.16A issued to all six job workers. During investigation the statement of employee and the director of the Appellant firm were recorded and all of them have stated that the goods were sent for job work. It is not in dispute that M/s Geena Synthetics, M/s Rama Filaments, M/s Mansa Synthetics, M/s Micro Polyester and M/s Good Luck Synthetics were existing at the time of investigation, albeit, they were not operating. However this cannot be interpreted that during the impugned period they were not in operation. None of the statements from the job workers recorded by the investigation deny the fact that they had undertaken job work activity on behalf of Appellant. In case of M/s A.A. Textiles, the unit was found non-existent as the officers recorded statement of person found at said unit who stated that some other unit was runnin....
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.... the Appellant did not get manufactured the fabrics and instead diverted the yarn in the market. No single evidence has been adduced by the Revenue to show that the Appellant had cleared yarn from their factory for sale as such and thereby evaded central excise duty. Not a single buyer of yarn has been identified by the Revenue nor there are any statements of the employee, authorized signatory or the director of the Company that the Appellant had cleared any yarn clandestinely and it is coupled with the fact that no consideration has shown to have been received by the Appellant. There are no evidences of transportation of yarn from the Appellant's factory or its diversion. It is a settled law that the allegation of clandestine removal should be based upon clinching evidences whereas in the present case, not a single evidence of clearance and sale of Yarn by way of any evidence in the form of clearance of yarn, identification of buyers, receipt of consideration and any single paper supporting the allegation of the revenue has been found. In case of CCE, Rajkot V.s Kalyan Glaze Tiles 2008 (222) ELT 417 (TRI)the Tribunal held as under : "2. The appellants' main contention is that t....