OPAL FABRICS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) This order seeks to dispose of eight appeals, two each by Opal Fabrics and Bhagatram Parmanand are against the common order of the Commissioner of Central Excise and Customs, Surat By this order, the Commissioner has demanded customs and excise duty on different goods form each of these appellants. He has imposed penalties under both the Customs and Central Excise Act on each of the appellants.

(2.) We shall first consider the appeal of Opal Fabrics. This appellant is a 100% export oriented unit at Sachin in Surat, licensed for the manufacture of grey fabrics. The unit was visited by the officers on 24.5.00 and the stock subjected to verification. This resulted in the shortage of 15990.200 kgs. of twisted yarn. Further investigation disclosed to the officers the fact that the twisted yarn has been supplied to this appellant by Bhagatram Parmanand another 100% export oriented unit, who had made it out of imported polyester yarn that it received without payment of duty and supplied to the appellant in terms of exemption 1/95. the fact of such receipt was accepted by Om Prakash Agarwal, the proprietor of Bhagatram Parmanand and authorised signatory of Opal Fabrics. Agarwal accepted that the yarn was sold by Opal Fabrics to various persons without filing the proper document and without payment of duty. Some quantities of yarn was also recovered from Suman Traders, Harish Traders and others at Surat and seized.

(3.) In addition, the officers found that Opal Fabrics had cleared the grey fabrics manufactured by it rejects of such grey fabrics and waste of yarn that arises during the manufacture of the fabric to various buyers in the domestic tariff area at the rate of duty contained in notification 2/95 i.e. 50% of the aggregate of the customs duty payable on such material had it been imported. Opal Fabrics had not physically exported any of its yarn that it manufactured.