At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Chennai
By, THE HONORABLE JUSTICE: D.N. PANDA
By, MEMBER AND THE HONORABLE JUSTICE: MADHU MOHAN DAMODHAR
For Petitioner: S. Kannappan, Advocate And For Respondents: S. Govindarajan, AC (AR)
1. Appellant says that the raw materials sent from Dharmapuri to Madurai for manufacture of dutiable finished goods for export was not doubted. But only because the place of manufacture was not registered, Revenue has realized the duty of Rs. 11,42,254/- from the appellant and imposed penalty under Section 11 AC of Central Excise Act, 1944 followed by interest. When the adjudication order is perused, it shows that the case was a procedural lapse of registration. But there is no iota of evidence as to non-receipt of the raw material by the manufacturer to manufacture finished goods and export the same. Today also Revenue is not able to produce any evidence to show that there was no export. Appellant satisfies that the export value was realized and bank realization certificates were produced.
2. Heard both sides and perused the records.
3. There is nothing on record to suggest that the appellant has not exported the finished goods manufactured in Madurai. There is no material available on record to appreciate that the raw material dispatched by appellant had not reached the factory of the manufacturer. So also there is no evidence to show that the manufactured goods were not exported. The nexus between the input and the output being established, this is not a case to doubt the credibility of the appellant. Accordingly, levy of duty is inconceivable.
4. So far as the penalty aspect is concerned, there is a lapse on the part of the appellant to take registration and follow the procedure, since the manufacturing unit belonged to the appellant. To remedy the lapse, appellant is directed to deposit penalty of Rs. 1,00,000/- (Rupees one lakh only) for the violation of the
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registration with the department and following the due procedure. In the result, appeal is partly allowed only to the extent of setting aside of the duty amount as indicated above.