M.R.P. TAPES Vs. CCE

JUDGEMENT

(1.) AFTER examining the records and hearing both sides, we are of the view that the appeal itself requires to be summarily disposed of. Accordingly, after dispensing with predeposit, we take up the appeal.

(2.) THE appellants are manufactures of "Knitted Elastic Tapes", for which they use cotton and synthetic yarns and rubber as inputs. On 27.2.2001, officers of Central Excise visited their factory and found a stock of final product as well as a stock of inputs. The appellants could not furnish any input -output norms required by the officers. Apparently, this was because they were procuring their inputs by weight (in kilograms) and clearing their final product in running length (in linear metres). The officers verified the stocks and calculated the quantity of inputs which might have been used in the manufacture of the tapes which were found in stock and, on a pro rata basis, estimated the quantity of inputs which might have been cleared as such out of factory after availing CENVAT credit and without reversing the same. On this count, the relevant show -cause notice demanded duty of over Rs. 9.1 lakhs.

(3.) THE officers also found that a partnership firm by name "Metro Tapes" was working in the adjacent premises and that the proprietor of the appellant -concern and his wife were partners thereof. For this and other reasons, the officers believed that the appellants were undertaking manufacturing activity in both the premises and, therefore, the clearances from both the premises required to be clubbed for the purpose of recovery of duty from the appellants. On this count, the SCN demanded duty of over Rs. 2.5 lakhs. Both the demands were contested. In adjudication of the dispute, the original authority confirmed the demand of duty against the appellants and imposed on them penalties. Aggrieved, the appellants preferred an appeal to the Commissioner (Appeals) and also filed therein an application for waiver of predeposit and stay of recovery of the duty and penalty amounts. The appellate authority, after considering the stay application, directed the appellants to predeposit an amount of Rs. 5 lakhs under Section 35F of the Central Excise Act. This deposit was not made. Having found no evidence of deposit, the appellate authority took up the appeal for final disposal and, without giving any opportunity of being heard, dismissed the appeal on the sole ground of non -compliance with Section 35F. Hence the present appeal.