Brief of the Case
In the case of CCE V/s M/s. Seagull Threads (India) Ltd., it has been held by Goa High Court that it is not permissible in law to consider the issue afresh in a proceeding which has already been settled by the same authority by its earlier order and had attained finality for want of any appeal against the original/earlier order, as no party to the litigation has challenged in any appellate forum.
The Factory premises of the Respondent Company M/s. Seagull Threads (I) Ltd. was visited by the Central Excise (Preventive and Intelligence) Unit of the Appellants Office. Records and materials were seized under Panchanama somewhere around 13.08.1996 and 16.08.1996. After due investigation, the Respondent was issued a show cause notice alleging clandestine manufacture and clearances of excisable goods manufactured by the Respondent without payment of duty. The Commissioner of Central Excise Goa confirmed and communicated the demand. The Respondents preferred an Appeal before the CESTAT against the order which was allowed thereby the Order demanding duty, penalty and interest was set aside. Being aggrieved by the said Order, the Appellant has preferred the present appeal.
Contentions of the Revenue
The Revenue pointed out the facts of the case and stated that on being aggrieved by the order of the Commissioner, the Respondents filed an Appeal before the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), which Appeal was allowed in part and, consequently, the demand of duty for Polyester Yarn was set aside and the demand of Viscose Yarn was confirmed; the penalty imposed under Section 11AC of the Central Excise Act was set aside; the penalty imposed under Rules 173Q was reduced to Rs. 2 lakhs.
The Respondents were called upon to pay the duty on Viscose Yarn as and when it was worked out. The Order passed by the CESTAT was duly accepted by the Commissioner and accordingly a demand was communicated to the Respondents by letter dated 13.05.2005. It is further the contention of the appellant that the Respondent called upon the Joint Commissioner to drop the demand for reasons stated in their letters. The Respondent also sought for a speaking order from the Joint Commissioner. A speaking Order was passed by the Commissioner after giving a personal hearing to the Respondent. But, however, the said duty was re-confirmed by the Appellant. Aggrieved by the Order, the Respondent preferred an Appeal before the CESTAT which was opposed by the Appellants and ultimately by impugned Order, the Appeal was allowed and the Order passed by the Commissioner, came to be set aside.
It has been further contended that the Tribunal has erroneously appreciated the evidence on record and has failed to consider that there was a shortfall which was established by the Appellants which made the Respondents liable to pay excise duty claimed along with penalty and interest.
It has been further submitted that as the original Order was accepted by the Respondent, the question of now disputing the correctness of the earlier findings by the Commissioner is totally erroneous.
Contentions of the Assessee
The assessee pointed out that on the basis of the material on record, it has been conclusively established that there was no shortfall at all during the relevant period. The allegations of the appellant that there was any manipulation or diversion of the inward records is totally perverse. It has been further contended by showing the balance sheet that the adjudicating authority has considered only the production portion and has not considered the fact that there was a closing balance of the very same product indicated in the balance sheet.
Held By Hon’ble High Court of Bombay at Goa
The Hon’ble High Court stated that the Tribunal has found that there were two aspects to be considered on the basis of the contention of the Appellants and the Respondents. First is the scope of the remand Order of the Tribunal and the next is as to whether the claim of duty penalty and interest is justified. The Tribunal has rightly noted that on perusal of the Order of the remand, it clearly says that the demand thereof is to be re-visited on the basis of total Viscose Yarn manufactured by the Respondent during the year in question.
The dispute in the present case is with regard to the claim of duty in respect of two types of goods, one is the claim in respect of polyester and the other is Viscose Yarn. With regard to the claim of Polyester Yarn, the CESTAT by an Order dated 19.07.2004, has come to the conclusion that the demand of duty on polyester yard cannot be accepted as it does not amount to manufacture. Whilst remanding the matter with regard to Viscose Yarn, the Tribunal found that the Commissioner whilst making the demand of duty for both Polyester Yarn and Viscose Yarn had not indicated the duty separately on each of these products and, as such, as no duty was payable with regard to the Polyester Yarn, the demand with regard to the Viscose Yarn had to be re-visited on the basis of goods manufactured by the Respondent during the period in question. The said Order clearly shows that the claim of duty with regard to Viscose Yarn was ordered to be re-examined by the authorities. In such circumstances, the contention of the Appellants that there was no question of re-examining the said issue cannot be accepted on reading the said order.
With regard to the claim of the Appellant that there was clandestine removal of Viscose Yarn, the Tribunal has noted that the amount claimed by the Appellant was in respect of 14.54 MTs. While determining the said figure, the Appellant had failed to note that closing balance was 24.16 MTs. Taking note of the said closing balance which has not at all been considered by the Adjudicating Authority whilst holding that there was clandestine removal of 14.54 MTs, the Hon’ble court found that the conclusion arrived at by the Tribunal cannot be faulted. The fact that the figures on the balance sheet have to be accepted has not been disputed by the Appellant. In fact the Tribunal has noted that there is no material on record produced by the Appellant to dispute the correctness of the figures shown on the balance sheet. These findings of fact by the authorities below cannot be re-appreciated by this Court in the present Appeal.
In view of the above, the appeal has been dismissed.