COMMISSIONER OF C. EX. Vs. WOOLTEX INDUSTRIES

JUDGEMENT

(1.) THE officers of Central Excise Preventive, Amritsar, visited the factory premises of M/s. Wooltex Industries, Amritsar on 25 -1 -1998 and found that they were engaged in the printing of grey fabrics with the aid of power and steam on job work basis. The unit was found working and the party was doing printing on man -made fabrics. Shri Satnam Singh, partner of the appellants -firm informed the visiting officers that there's is a partnership firm and they had installed the machinery for printing the fabrics; that they were receiving grey man -made fabrics from the traders and after doing printing, the same were dispatched in the running lengths to the traders under the cover of invoices/challans. The visiting officers seized 270 metres valued at Rs. 4,950/ - of finished printed fabrics lying in the unit and the proceedings were initiated against them. They were issued a show cause notice dated 20 -7 -1998 by the Deputy Commissioner of Central Excise, Amritsar in which they were called upon to show cause why the central excise duty amounting to Rs. 3,68,9207 - on the man -made fabrics valued at Rs. 23,63,529/ - clandestinely removed by them during the period from 23 -2 -1995 to 25 -1 -1998 and of Rs. 990/ - leviable on the seized man -made fabrics should not be recovered from them under Rule 9(2) of Central Excise Rules, 1944 read with Section 11A(1) of Central Excise Act, 1944. They were also called upon to show why 270 metres of man -made fabrics valued at Rs. 4,950/ - seized on 25 -1 -1998 from their unit should not be confiscated under Rule 173Q, why a penalty should not be imposed on them under Section 11AC read with Rules 9(1), 173Q and 226 of Central Excise Rules, 1944 and why the interest should not be charged from them under Section 11AB of Central Excise Act, 1944. Shri Satnam Singh, partner of the firm was also called upon to show cause why a penalty should not be imposed on him under Rule 209A of Central Excise Rules, 1944.

(2.) THE party replied to the show cause notice. The submissions made by them before the adjudicating authority are paraphrased as follows in the Order dated 9 -1 -2000 passed by the Joint Commissioner of Central Excise, Chandigarh -II : -

(3.) CONSEQUENTLY , the Joint Commissioner confirmed'the demand of Rs. 3,68,020/ - on the party under Rule 9(2) read with Section 11A of Central Excise Act, 1544. He further ordered for confiscation of 270 metres of the seized man -made fabrics valued at Rs. 4,950/ - but however, gave an option to the party to redeem the same on payment of a fine of Rs. 500/ -. He also imposed a penalty of Rs. 3,69,020/ - on the party under Section 11AC of Central Excise Act, 1944 read with Rules 9(2), 173Q and 226 of Central Excise Rules, 1944. He further directed the party to pay the interest on the confirmed demand as provided under Section 11AB of Central Excise Act, 1944. Though Shri Satnam Singh, partner of the firm was also put on notice for the imposition of penalty under Rule 209A, the Joint Commissioner however has passed no order against him.