LAXMI ENGG. WORKS AND ANR. Vs. CCE

JUDGEMENT

(1.) THESE two appeals have been filed by the appellants against the common Order -in -Original dated 20.2.2001 passed by the Commissioner confirming the duty demand as well as imposing penalty under Section 11AC of the Central Excise Act and Rule 209A of the Central Excise Rules, as detained therein, on them.

(2.) ON 29.11.1995 one tempo No. DBL 6399 loaded with copper wire rods was intercepted by the officers of the Central Excise Anti -Evasion near Shahdara Flyover, Petrol Pump. On demand the driver of that tempo could not produce any bill, invoice, challan etc. He, however, disclosed that the goods in his tempo were loaded by the firm M/s. Laxmi Engineering Works (Appellant No. 1) for delivery at Vishwas Nagar. The tempo and the driver both were taken to the premises of appellant No. 1 where Bhupinder Jain (appellant No. 2), Director of M/s. Dina Industries was present. The firm M/s. Laxmi Engg. Works (appellant No. 1) was owned by M/s. Dina Industries Pvt. Ltd. and this fact was revealed by Bhupinder Kumar Jain (appellant No. 2) himself. In a follow -up action the search of the factory premises of appellant No. 1 was conducted which yielded recovery of 65 slip pads, some loose papers and one register showing account of copper wire rods and sillies. All these documents were resumed. The statement of Bhupinder Kumar Jain (appellant No. 2) was recorded wherein he admitted the correctness of the entries recorded in all those documents. Sohan Lal, Supervisor who recorded entries in those documents also admitted in his statement the correctness of the entries made therein. He further admitted that out of 65 slip pads, some loose papers and one register showing account of copper wire rods and sillies. All these document were resumed. The statement of Bhupinder Kumar Jain (appellant No. 2) was recorded wherein he admitted the correctness of the entries recorded in all those documents. Sohan Lal, Supervisor who recorded entries in those documents also admitted in his statement the correctness of the entries made therein. He further admitted that out of 65 slip pads recovered 30 pertained to receipt of sillies while 35 related to the manufacture of copper wire rods. He also stated in his statement that these recovered documents were prepared/maintained by him or by Nagendera or Prem (Raju) the other two employees of the firm (appellant No. 1) and on that basis of the slip pads, entries were made in the register date wise showing the receipt of the raw material i.e. ingot/sillies in the factory and the copper wire rods manufactured out of the same and despatched to the customers. On completion of the investigation show cause notice dated 4.5.2000 was issued to both the appellants wherein it was alleged that they received/purchases sillies/ingots from different resources during the period 16.7.1995 to 27.11.1995 weighing 26,13,484.210 kgs. and manufactured therefrom copper wire rods valued at Rs. 38,50,79,145.67 at the rate of Rs. 155/ - per kg. It was also alleged in those notices that they did not maintain a proper statutory record correctly regarding the receipt of the raw material, manufacture and sale of the finished goods during that period.

(3.) ON receipt of the above said show cause notice the appellants contested the correctness of the allegations made therein. In reply to that show cause notice they denied the recovery of 65 slip pads, some loose papers and one register from the premises of the factory. They also requested for cross -examination of Sohan Lal and the punch witnesses in whose presence the alleged record was seized. Bhupinder Kumar Jain (appellant No. 2) denied the voluntary nature of his statement dated 29.11.1995 and maintained that the said statement was obtained under duress and he duly retracted the same vide letters dated 30.11.1995, 11.12.1995/12.12.1995, telegram dated 13.12.1995 and another letter dated 8.1.1996 addressed to the Chairman, CBEC and Commissioner of Central Excise. He also retracted his subsequent statements dated 13.12.1995 and 20.12.1995. He in his statement dated 6.5.1995 denied that Nagendra and Prem were his employees in the factory. He also averred that the factory did not even have the capacity to manufacture the quantity of the copper wire rods, as alleged in the show cause notice and that the firm (appellant No. 1) was doing only the job work of preparing copper wire rods form the raw material i.e. sillies/ingots, supplied by others.