2005 (6) TMI 190

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.... Roving Ends outside the factory for processing, without debiting 10% of its value in terms of Rule 57F(6) of the Central Excise Rules, 1944. The officers recorded statements from Shri C.T. Veerappan (Manager), Shri R. Pari (Managing Director) and Shri A. Selvaraj (job worker to whom the aforesaid quantity of 4559.7 Kgs. of input was cleared). From the results of investigations, it appeared to the department that the appellant had cleared 594.25 Kgs. of cone yarn clandestinely without payment of duty, that they had removed 4559.7 Kgs. of 'staple fibre roving ends', without debiting 10% of its value in terms of Rule 57F(6), to the job worker and that they had also removed 2328 Kgs. of staple fibre clandestinely without payment of duty. Accor....

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.... has argued that no finding of clandestine removal of cone yarn could be reached on the basis of such statements. I find substance in this argument. Though it was clearly indicated by the Manager that he had instructed the 'maistry' to re-wind the defective cone yarn, it did not occur to the Central Excise officers that the 'maistry' should be called upon to confirm or contradict the Manager's claim. When both the Manager and the Managing Director offered a cogent explanation for the shortage of 594.25 Kgs. of cone yarn, it was upto the department to gather adequate positive evidence of clandestine removal of the goods so as to rebut such explanation. No such evidence is forthcoming from the records. In the case of Icycold Commercial Enterp....

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....amount was debited by the appellants under sub-rule (6) and hence there was no occasion for them to take re-credit of equal amount under sub-rule (7). Had the appellants debited 10% of the value of the inputs under sub-rule (6), they would have taken re-credit of equal amount under sub-rule (7) upon receipt of the reprocessed inputs from the job worker. As, in the facts of this case, all these stages were over by the time the officers visited the appellants' factory, the demand raised under sub-rule (6) of Rule 57F is infructuous. Ld. consultant has also challenged this demand on the ground of limitation. He has submitted that, in view of revenue neutrality involved in the above transactions, it cannot be held that the appellants had intent....