THIRD MEMBER ON REFERENCE : SHRI S.S. SEKHON, MEMBER (T) CHARIOT CEMENT COMPANY Vs. COMMR. OF CUSTOMS & C. EX., BBSR-II

JUDGEMENT

(1.) THE issue involved in these three Appeals, is whether the Cement manufactured by M/s. Chariot Cement Company was cleared by them from their factory without payment of Central Excise duty.

(2.) SHRI S.K. Bagaria, learned Advocate, submitted that the Appellants manufacture cement at its factory situated at Kalunga since last more than 15 years; that the demand of Central Excise duty has been demanded from them, under the impugned order by the Commissioner of Central Excise, on the ground that from the records relating to the Railway Receipts lying with the Railway Authorities, it appeared that they had cleared cement to the following parties/places without recording the same in their statutory records and without payment of duty :

(3.) 1 Regarding the alleged dispatches to M/s. City Developers, the learned Advocate submitted that the said cement was neither manufactured nor cleared by them from their factory nor even purchased and sold by them; that the allegation in the show cause notice was made simply because these goods were covered by the Railway Receipt in their names; that this was so because the Appellants had permitted M/s. City Developers to utilize the available space in the Railway rake allotted to the Appellants; the learned Advocate explained that for movement of cement, manufacturers file an indent with the Railways and depending upon the availability, full rake consisting of 40 wagons are allotted by the Railways; that on several occasions, the manufacturer is not having sufficient goods of his own so as to make a full rake load; that in such situations, the manufacturer permits other manufacturers/traders to utilize the available space for transporting their goods; that in all such cases, even though the goods belonging to other parties are permitted to be loaded, the Railway Receipts are invariably in the name of the manufacturer whom the rake has been allotted to. The learned Counsel mentioned that M/s. City Developers are known to the Appellants and the goods covered by the Railway Receipts (RRs) against serial Nos. 1 to 16 of the table given in Para 5.5 of the Notice was purchased by the M/s. City Developers from various other parties and the Appellants permitted them to load their goods in the rakes allotted to the Appellants from time to time; that M/s. City Developers had certified these facts in Certificate dated 15 -2 -2001 giving bill wise details of the purchase of the entire quantity of 1,16,785 bags as well as RR wise details of the freight paid by them; that City Developers had also mentioned in the Certificate that all the transactions were duly entered in their audited books of account. The learned Advocate also mentioned that the Department had not conducted any enquiry from City Developers or from the parties whom the cement was purchased from; that all the payment of freight was paid by City Developers by draft about which also no enquiry had been made by the Department; that the Commissioner, in the impugned order, has brushed aside the factual position and the said Certificate by merely observing that these aspects should have been clarified at the time of investigation or the same should have been brought to the notice of the higher authorities and that Appellants submission were only after -thought; that the Adjudicating Authority was required to decide the issue on the basis of evidence and not disregard the submissions by merely treating them as afterthought; that the Commissioner has also given his findings that it was not indicated as to from where the local dealers had purchased cement; that if the Department wanted to get any further details, the enquiry could have been made from the said suppliers; that, therefore, the Commissioner totally erred in confirming the demand on presumption as if the said goods of City Developers were manufactured by the Appellants without any basis or material.