AKASH FABRICS Vs. COMMISSIONER OF CENTRAL EXCISE, DAMAN

JUDGEMENT

(1.) All the appeals are being disposed off by a common order as they arise out of the same impugned order passed by Commissioner vide which duty of Rs. 1,42,89,792/ - stands confirmed against M/s. Akash Fabrics along with imposition of penalty of identical amount in terms of Section 11AC of the Central Excise Act, 1944 read with Rule 25 of the Central Excise Rules, 2002 on the allegations and findings of domestic clearance of duty free procured partially oriented yarn, instead of utilizing the same in the manufacture of the goods to be exported. In addition interest also stands confirmed against them in terms of the provisions of Section I1AB of the Central Excise Act, 1944. Further, penalty of Rs.20 lakhs stands imposed upon the two partners Shri Jayprakash Motwani and Shri Iqbal J. Memon of M/s. Akash Fabrics. In addition penalty of Rs. 10 lakhs each stands imposed upon M/s. Shree Ram Synthetics, Surat and its partner Shri Pawankumar R. Bansal.

(2.) WE have heard Shri B.L. Narsimhan, ld. Advocate appearing for the appellants and Dr. M.K. Rajak, ld. SDR for the Revenue.

(3.) AS per the facts on record, M/s. Akash Fabrics is the 100% EOU situated in Daman and entitled to procure Partially Oriented Yarn (POY) under CT -3 certificates, without payment of duty. During the relevant period, appellant was procuring the said POY from M/s. Filatex India Ltd. and other manufacturers. Their factory was visited by the officers of DGCEI on 14 -7 -2003 and various checks and verifications were conducted. It was found that out of the two texturising machines installed in the factory, only one was in operation. One of the texturising machines and all the twisting machines were found to be in a state of dis -repair, rusted and having gathered dust and cob -webs. Even the circular knitting machines installed in the adjoining shed were found to be not in operation and not loaded with any of the raw material i.e. POY. Some of the machines were in stages of assembly and were not even complete. The records produced by the appellant were seized and officers also noticed shortage of 240 cartons of duty free procured POY from the recorded stock of raw materials.