HIMLA HOSIERY MNFG. DYEING AND Vs. CCE

JUDGEMENT

(1.) The above captioned appeals have been filed by the appellants against a common Order -in -Original dated 13.12.1999 vide which the adjudicating authority has confirmed the duty demand of Rs. 13,78,557 with an equal amount of penalty on the company M/s Himla Hosiery Manufacturing Dyeing and Printing Mills (P) Ltd., besides ordering confiscation of goods with option to get the same redeemed on redemption fine of Rs. 20,000 and further imposed penalty on the appellant No. 2, as detailed therein.

(2.) Appellant No. 1 being a company of which appellant No. 2 is a Managing Director. The company was engaged in carrying out the process of embroidery on the base fabrics and also availing facility of compound levy for discharging the duty liability. They had been filing applications for availing special procedure in terms of Rule 96 GH from time to time. On 29.7.98, Officers of the Preventive staff of the Central Excise paid a surprise visit to the embroidery unit of the company and at that time all the 9 embroidery machines installed in the unit were found working and fabrics were being embroidered. The appellant No. 2 being Director of the company was called but when he reached in the factory, there was complete darkness electricity and generator installed therein both went out of order. However, his statement was recorded in the candle light. He was also informed by the workers about running of all the 9 machines. The necessary papers could not be completed for want of electricity in the factory. Therefore, on the following day i.e. 30.7.98, the officers again visited the factory and completed formalities regarding seizure of the goods found lying there and recorded statements of S/Shri Ashok Yadav, authorised representative, Waryam Singh, Sales -cum -Production Manager, Ashok Kumar Yadav, Ravinder Singh, Embroidery Supervisor Hari Kishan Yadav etc. who all admitted that during January 1998 to August 1998 all the 9 embroidery machines had been working 24 hours in two shifts except on holidays/weekly off. On completion of the investigations. Show -cause Notice was accordingly served on the appellants as well as on the employees named above, whose statements were recorded, raising duty demand against appellant No. 1 - - the company and proposing imposition of penalty under Rule 209 A on others. After getting their reply wherein they controverted the allegations contained in the Show -Cause Notice against them and further alleged that their statements were recorded under duress, the adjudicating authority passed the impugned order.

(3.) Learned Counsel has contended that there is no cogent, convincing and tangible evidence to prove the evasion of duty by the appellants by running not only one machine for which the declaration, was filed for the purpose of discharging duty, but extra 8 machines, during the period in question. The documentary and oral evidence relied upon by the adjudicating authority is inadmissible, insufficient to bring home the allegations as levelled against the appellants in the Show -cause Notice. The impugned order deserves to be set aside.