Judgment:
l. Through these stay applications, the appellant No. 1, M/s. Haryana Cable Industry has prayed for waiver of pre-deposit of duty of Rs. 1,54,42,723.43 and equal amount of penalty besides personal penalty of Rs. 5,00,000/- and Rs. 3,00,000/-. Similarly, the appellant No. 2, M/s.
Deepak Cable Company has sought waiver of pre-deposit of duty amount of Rs. 89,38,564.08 with equal amount of penalty and personal penalty of Rs. 3,00,000/- and Rs. 5,00,000/-.
2. The learned Counsel for both the appellants while arguing the stay applications has contended that there is no tangible evidence on record to prove the very manufacture of insulated wires and cables, during the years 95 to 98 by the appellants much less the clearance of the same without payment of duty by them. They had no machinery even for carrying out the manufacture of insulated wires and cables. Rather they were only manufacturing domestic wires and cables. The Counsel has also pointed out that fair opportunity for producing defence evidence was also not afforded to the appellants. Therefore, the impugned order of the Commissioner, on the face of it, is untenable under the law and as such, the prayer of the appellants for total waiver of pre-deposit of duty and penalty amounts deserves to be allowed.
4. The bare perusal of the impugned order shows that Tara Chand Gupta alias Tara Chand Goel, who is proprietor of the firm, appellant No. 1, in his written statement, very candidly admitted that he was running the firm M/s. Haryana Cable Industry since, 1992. He also admitted the issuance of the invoices which were shown to him, during the course of his statement vide which the clearances of the value of Rs. 60 lakhs during the year 1997-98, of insulated wires and cables were also made by him. He further admitted that wires and cables were also sold by him against cash payment without issuing the bills and without paying any central excise duty. He confessed his mistake of having not paid the duty and promised to deposit the duty. He also admitted that he even did not file any income-tax return. The correctness of the sales tax documents which he filed before the Sales Tax department during the year 1993-94 to 1997-98 was also admitted by him wherein he had shown sales of Rs. 47,18,356.70, Rs. 24,60,949/~, Rs. 27,42,408/-, Rs. 19,28,029/- and Rs. 18,25,078/- respectively in those years. He also did not dispute that his firm had two bank accounts and during the above said years, the firm deposited Rs. 8.46 crores in that account and that money was the sale proceeds of the goods manufactured and cleared by him (Refer Para 88 of the impugned order).
5. Similarly, Bhushan Kumar Gupta, partner of appellant No. 2, M/s.
Deepak Cable Company, in his written submission, admitted the clearance of insulated wires and cables during the disputed years without issuing the invoices. He undertook even to deposit duty as soon as possible. He also admitted the deposit of Rs. 94.45 lakhs, Rs. 180.15 lakhs, Rs. 142.29 lakhs, Rs. 137.59 lakhs and Rs. 6.46 lakhs respectively during the years 1994-95,1995-96, 1996-97, 1997-98 and 1998-99 (up to August, 1998), in the bank which he earned from the sale of goods manufactured and cleared by him without payment of duty.
6. The argument of the learned Counsel that invoices, issuance of which was admitted by both the appellants, were bogus and these were issued only at the instance of the other manufacturers who cleared their own goods under those invoices and that the appellants only charged commission of 1% from them and that the goods i.e. insulated wires and cables were never manufactured, for want of any machinery, cannot be priwa facie sustained in view of the admission made by Tara Chand Gupta, Proprietor of appellant No. 1 and Bhushan Kumar Gupta, partner of appellant No. 2 which had been detailed by the adjudicating authority in Paras 88 and 89 of the impugned order. The perusal of the impugned order further shows that the other parties for whom the appellants allegedly issued the invoices by charging 1% commission, did not admit this fact. They rather denied of having got issued such invoices on payment of commission from the appellants. The fact that the Revenue while opposing the bail application of the proprietor and partner of the appellants, in the court, also alleged that invoices issued were bogus, as pointed out by the Counsel, does not in any manner, advance the plea of the appellants. The Revenue has alleged those invoices as bogus because the goods were in fact cleared by the appellants in a clandestine manner without issuing proper invoices and without accounting for the same in the record.
7. Keeping in view the facts, circumstances referred to above and the detailed reasons recorded by the adjudicating authority in the impugned order, we do not find that the appellants have got a strong prima facie case. The evasion of the central excise duty rather stands admitted by them as is evident from the statements of Tara Chand Gupta and Bhushan Kumar Gupta, referred to above.
8. The perusal of the impugned order also shows that the appellants were afforded ample opportunity to defend themselves and to substantiate their defence. Prima facie there had been no violation of rules of natural justice.
9. Therefore, keeping in view the facts, circumstances of the case, the evasion of huge amount of central excise duty by the appellants, issue involved and the financial position of the appellants, as they had been depositing lakhs of money in their accounts in the bank after evasion of central excise duty, as detailed above, we direct the appellant No.1, M/s. Haryana Cable Industry to make pre-deposit of Rs. 70,00,000/- (Seventy lakhs) and appellant No. 2, M/s. Deepak Cable Company of Rs. 40,00,0007- (Forty lakhs) on or before 8-4-2002. On making these deposits, requirement of pre-deposit of balance duty amount and entire penalty amounts by them shall stand waived and recovery stayed till the disposal of the appeals. But in case, they failed to comply with the terms of this order, their appeals will become liable to be dismissed under Section 35F of the Act.