CCE Vs. EMTEE POLY YARN

JUDGEMENT

(1.) The issue for determination in the these appeals filed by the Revenue against the orders passed by the Commissioner (Adjudication) Central Excise, Mumbai is whether the Commissioner was justified in holding that the Department has failed to prove under -valuation at the instance of the assessees as alleged in the show cause notices.

(2.) The respondents are engaged in the manufacture of PTY Twisted Yarn falling under Chapter sub -heading 54.02 of the Schedule to the Central Excise Tariff Act, 1985. Intelligence was received that they were indulging in evasion of central excise duty by resorting to undervaluation and clandestine clearance of PTY; that they were clearing PTY from their factory gate at a very low value in the name of fictitious/or non -existing firms, while the goods were actually being cleared to godown at Bhiwandi etc. from where they were subsequently being sold to actual buyers at higher value. Show cause notices were therefore issued alleging that the respondents had issued invoices to show that the sale had been effected at the factory gate, whereas sales were actually effected from godown/warehouses of the transporters at Bhiwandi. It was alleged that the sale price shown in the invoice did not reflected the correct assessable value since the buyers name shown in the invoice were fictitious. It was further alleged that the sale between the buyer and the seller was finalized and the payments from actual buyers were received through crossed bearer cheques and not through account payee cheques. The Commissioner dropped the proceedings holding, inter -alia, that the allegation of the Revenue that the goods were sold from depots or godown of the transporter at a price higher than that declared in the corresponding invoices has not been established. Hence these appeals.

(3.) On hearing both sides we find that identical issue came up for consideration before the Tribunal in the case of CCE, Daman/Valsad v. Kayem Synthetics Pvt. Ltd. and Ors. 2003 (90) ECC 699 (Tri) (Final Order No. 468 -485/03 -NB(A) dt. 13.8.03) in which the Bench upheld the finding of the Commissioner and rejected the appeals of the Revenue. Relevant paragraph from the Tribunal's order are reproduced below: