SWATHY INDUSTRY AND ORS. Vs. CCE

JUDGEMENT

(1.) HEARD both sides on the applications for waiver of predeposit of duty of excise of Rs. 3,02,08,777/ - together with penalty of equal amount. The demand stands confirmed on Section 4 assessment of branded detergent cakes and washing powder manufactured by the assessees herein.

(2.) WE do not see any prima facie merit in the submission of the assessees that it is Section 4A assessment that should have been resorted to instead of Section 4 assessment for the reason that the complete MRP for the entire period of dispute namely April 2004 to September 2007 was not available and the assessees furnished only the immediate MRPs - in the statement of Shri M. Krishna Kumar, Partner of M/s. Swathy Industry. The submission of the assessees that the demand takes into account not only goods manufactured by Swathy Industry but also other goods not manufactured by them, is also prima facie not tenable in the light of the statement of Shri Sundaram, dealer and proprietor of M/s. Adhavan Agency who prepared the line sales report of Swathy Industry and admitted that all the sales reflected in the reports were those of goods manufactured by Swathy Industry and by the statement of Shri Shanmugam, an other dealer who also corroborated the statement of Shri Sundaram. In these circumstances, prima facie, the denial of the request of the assessees for cross -examination of Suresh Kumar from whose residence the line sales report relied upon for the purpose of computing the demand is not fatal to the case of the Department. The denial of the request for cross -examination of Shri Sanjeev Kumar Jain, supplier of acid slurry which is a necessary ingredient for manufacture of detergent cakes and powder is also prima facie not fatal to the case of the Department in view of the detailed statements of both dealers, Shri Shanmugam and Sundaram. Since no prima facie case for total waiver has been made out by the assessees, and having regard to the plea of financial hardship, we direct predeposit of a sum of Rs. One crore by M/s. Swathy Industry within eight weeks from today and on such deposit predeposit of the balance duty and penalty on the manufacturer as well as penalties on the two dealers as well as on Krishna Kumar and Muthuswamy, partners of Swathy Industry shall stand waived and recovery thereof stayed during the pendency of the appeals. E/S/247/2009 filed by Smt. S. Janaki is dismissed as she has not been penalized by the impugned order and the challenge in the application is to the levy of redemption fine which does not fall within the scope of the provisions of Section 35F of the Central Excise Act, 1944. Failure to comply with this direction shall result in vacation of stay and dismissal of the appeals without prior notice.