AMTEK AUTO LTD. Vs. CCE

JUDGEMENT

(1.) These appeals are filed by the appellants against the order dated 21.11.2001 passed by Commissioner Central Excise Delhi -Ill. The issue relates to denial of modvat credit on capital goods. Since the issue in all the 5 appeals is common, all the appeals are being disposed of by this common order. Briefly stated the facts of the case are that M/s Amtek Auto Group of companies (herein after called "appellants") at the material time was comprised of 5 manufacturing units namely:

(2.) Shri Bipin Garg learned Advocate appearing on behalf of the appellants has submitted that all the 4 units mentioned in the show cause notices are separate legal entities; individually incorporated with the registrar of the companies located at different places and manufacturing different excisable goods, these units are also separately registered in Central Excise Deppt. and with other state agencies like Sales Tax, ESI etc.; all 4 units submitted their replies to the show cause notices separately; that case was last listed for hearing on 9.3.2000 but the Commissioner of Central Excise Delhi -III to the respondent with this appeal adjudicated to the show cause notice vide in original No. 2/2000 dated 28.2.2000 without affording opportunity of personal hearing, without appreciation of submission made by appellants in their written reply. That earlier CEGAT vide final Order dated 28.6.2000 has remanded the matter on the ground of violation of principles of natural justice; that the personal hearing was fixed on 29.8.2001 and the appellants vide letter dated 23.8.2001 individually requested for permission to procure documents/records assumed by the officer so as to enable them to prepare defence reply and appellants also requested for one months time for submission of defence reply; that without appreciating submission made by the appellants in their letter dated 23.8.2001, another date of hearing was given on 27/28.9.2001; appellants vide letter dated 28th September 2001 again requested for inspection/supply of the relied upon record/document before the said date of hearing; despite the subsequent repeated requests, the respondent verbally rejected the request for supply/inspection of the relied upon documents; accordingly appellanis appeared before him on 1.10.2001 and submitted their written submission individually; that they produced documentary evidence in support of the fact that the machines in question are installed in their respective unit; the respondent unilaterally and arbitrarily decided the case vide de novo order in original No. 55/2001 dated 21.11.2001 without observing the principles of natural justice and without taking into consideration the submissions made by the appellants, confirming and appropriating the same and imposing equivalent amount of penalty under erstwhile Rule 57U(6) read with 173Q besides imposing penalty of Rs. one lakh on the Managing Director under Rule 209A; that only dispute in the present case is that the appellants having manufacturing units as mentioned in the preceding paras had taken irregular modvat credit on the capital goods which were alleged to be not found installed or used in the respective factory; that contention of the department is merely based on the statement of Shri Vinod Uppal (Manger of Accounts and Finance) without verification of its authenticity with reference to the relevant accounts records maintained by the appellant; with regard to the receipt, installation and use of machines in question in respect of the units for manufacturing final product cleared on payment of duty and without physical verification of the capital goods in question in the respective units; that in de novo proceedings learned Commissioner had failed to appreciate the submissions made in their reply filed on on 13.12.1999 to the impugned show cause notice, written submission of 1,10.2001 filed at the time on the personal hearing on 1.10.2001; that the observation of the learned Commissioner is based on assumption and presumptions entirely based on false investigation report of the Central Excise Officers that Commissioner has merely gone by the statement of Shri Vinod Uppal without verification of his correctness with reference to relevant records and documents; that statement of Shri Vinod Uppal recorded on 1 1.3.1999 regarding verification of the capital goods in question with reference to RG 23 C (Pt I and II) is meaningless when he was not participant to the physical verification done on 2.2.1999, 4.2.1999. 5.2.1999 and 6.2.1999 in respective factory; that from the statement of Shri Vinod Uppal it is not clear whether list of capital goods drawn by the investigating officer was of those capital goods which were installed in the factory or of those not installed in the factory; that statement of Shri Vinod Uppal is not only confusing but contrary in itself, which itself is sufficient evidence to prove that it was dictated and tutored; that when the statement of Shri Vinod Uppal was not reliable being contrary, it was incumbent on the respondent to have brought on records some other positive and concrete evidence to sustain the allegation; that the impugned order travels beyond the allegation in the show cause notice; that the relevant copies of RG -23C Pt -I and II submitted by the appellant together with the relevant invoices clearly establish the receipt/installation of the machine in question in a particular factory to whom it was consigned; that modvat credit was availed on the basis of valid duty paying documents and capital goods were appropriately accounted for in the Central Excise statutory records and were verified by the Deptt. officers on their visit to the respective units; that impugned order is non speaking as well as also violated principles of natural justice as the submissions made by the appellants have not been considered by the Commissioner and viz -a -viz, the request for inspection/supply of the relied upon documents has also not been acceded to by the commissioner as the same were in possession of the department though the same have been relied upon in the show cause notice; that nothing has been brought, on record by the Deptt. or in the show cause notice that they have found any thing incriminating during their visit; that Shri Uppal was not a technocrat expert in the field so as to verify the listed items shown to him which were available in the factory; that the statement recorded would have been of some value if the same was from the works manager.

(3.) That in support of his contention learned Advocate relied on the following decision: