ARTI STEEL LTD Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS appeal has been filed challenging the findings of the Commissioner of Central Excise, Chandigarh dated 6 -11 -1997 confirming a Central Excise duty demand of Rs. 49,81,884.17 from the appellants. A penalty of Rs. 10 lakhs was also imposed on them by the said order.

(2.) THE said order was in fact passed by the Commissioner pursuant to a direction given by this Tribunal vide order dated 14 -5 -1993 directing the Commissioner to conduct a de novo adjudication on the charge of clandestine production and removal of iron and steel products by appellants from their factory. The said direction for de novo adjudication was made by the Tribunal while disposing of an appeal filed by the present appellants against the Order -in -Original passed by the Collector on 15 -12 -1992. While directing de novo adjudication of the matter, the Tribunal had observed, following its earlier decision in Premier Packaging (P) Ltd. v. C.C.E., New Delhi [1986 (26) E.L.T. 333 (Tribunal)], that Rule 9 of the Central Excise Rules, 1944 would apply where it is shown that excisable goods have been removed without payment of excise duty leviable thereon. However, to substantiate the charge under Rule 9, it was also necessary that evidence of clandestine manufacture and of surreptitious removal should be established. The Tribunal had observed that no finding had been given in the impugned order about surreptitious removals viz., the mode/manner in which the goods had been disposed of. The adjudicating authority had not made any enquiries from any independent source about the average consumption of electricity, correlation of the production data about electricity consumed in other units similarly placed, etc. The Tribunal therefore directed that where there is unexplained large variation in respect of consumption of electricity and corresponding production of the final product, a test run should have been got done in the assessee's unit for the said period and norm adopted on that basis. The Tribunal had further observed that the Collector should have correlated the octroi records and records of the Electricity Department with the entries contained in the private records of the assessee which had been resumed by the Department. A direction was therefore given for correlating the private records with other independent evidence. On these grounds, the Order -in -Original dated 15 -12 -1992 was remanded to the Commissioner for de novo adjudication in the light of the observations made by the Tribunal in its order after complying with the principles of natural justice and after giving them an opportunity of being heard in the matter.

(3.) LD . Counsel for the appellants Shri R. Santhanam has strongly urged that the Order -in -Original presently impugned in the appeal before us has failed to carry out the directions given by the Tribunal in the remand order. He submits that the Commissioner has only reiterated the findings and reasoning contained in the first Order -in -Original. He submits that this was a clear case of non -application of mind by the adjudicating authority and therefore patently illegal and contrary to the well established principles and therefore liable to be set aside.