PARAS LAMINATES P. LTD. Vs. CCE

JUDGEMENT

(1.) M /s. Paras Laminates Pvt. Ltd. and Shri Ravi Bansal, Director, have filed these two appeals arising out of a common Order -in -Original, by which the Commissioner, Central Excise, has confirmed demand of Central Excise duty against the Appellant Company and imposed penalties on both the Appellants.

(2.) SHRI A.R. Madhav Rao, learned advocate, mentioned that the Appellants manufacture laminated sheets in their factory at Bhiwadi (Rajasthan) and have their godown at Delhi; that they have mainly sold under DGS&D Rate Contract the laminated sheets under the brand name "Paras" to the Indian Railways; that they were supplying the laminates after manufacture at Bhiwadi factory or from the Delhi godown; that the purchased laminated sheets were stocked at Delhi, branded as "Paras" and offered for visual inspection at Delhi and samples were drawn, taken to Bhiwadi factory and tested there; that in view of such trading activity, they obtained necessary sales tax registration; that the laminated sheets have been procured against S.T.I form and the sales tax returns have all been assessed; that S.T.I is for re -sale under the Delhi Sales Tax Act, 1975 and there is no tax on the dealers if S.T.I is given to them; that "D" Form is given by Railways on sale of traded goods to them for concessional rate of Central Sales Tax @ 4% instead of 10%, normal rate; that in Delhi the sales tax is levied on first point sale and "D" forms are only for Government suppliers; that "D" forms of Delhi supplies to Railways show Delhi address. He also mentioned that on acceptance of the lots offered from Delhi procured from the market, the goods were despatched directly from the Delhi godown to the respective railway destinations; that the procurement of laminated sheets are paid by cheque and transactions are duly recorded; that sometimes where the supply from Delhi slightly fell short of the lot requirement sheets, then such shortage was made good by sending the material to Delhi from factory at Bhiwadi on payment of duty; that the goods were sent to Delhi to avoid double transportation; that at other times, the goods have gone directly from Bhiwadi and Delhi to the respective destinations.

(3.) THE learned Advocate submitted that the impugned order is based on erroneous inferences drawn from the terms of the DGS&D rate contract and the statement of the dealers that the laminated sheets supplied under DGS&D rate contract were all goods manufactured in the factory and clandestinely removed to Delhi; that it has been the consistent view of the Tribunal that to allege and establish clandestine removals, it has to be supported by evidence with regard to purchase of inputs, production, source of founds, sale and receipt of consideration [Ambica Chemicals v. CCE, 2002 (148) ELT 191 (T)]; that they had requested the cross -examination of all the dealers and Shri Gairola, Ex -General Manager of their company; that only Shri I.C. Khanna, Deputy Director, Quality Assurance, DGS&D, New Delhi turned up for cross -examination; that thus reliance on the statements of all the persons who did not turn up for cross -examination is totally uncalled for since the same have not been tested by cross -examination and hence the Order is liable to be set aside. Reliance has been placed on the following decisions: