ORDER
D.M. Vasavada, Member (J)
1. The appellant is engaged in manufacture of vegetable products falling under CET Item 13 and refined oil (processed vegetable non-essential oil) falling under CET Item No. 12 of the erstwhile First Schedule of the Central Excises & Salt Act, 1944. It was alleged against them that they had prepared one gate pass for the clearance of a consignment consisting of 700 tins of vegetable products and the same was consigned to Navbharat Banaspati & Allied Industries, but instead, it was transported to M/s. Purshotam Lal Vishwa Nath of Jal-landhar City without the cover of any valid documents, such as gate pass, inasmuch as the consignment was destined for Hoshiarpur whereas the consignment was transported to Jallandhar. So, the appellant contravened provisions of Rule 52(A) of C.E. Rules, 1944 (hereafter referred to as the Rules). The second allegation was that a consignment of 700 tins of vegetable products was received at Khanpur gate octroi post at Hoshiarpur on 8-11-1977 at 1.30 P.M. by a truck No. PUN 6494 and octroi charges were paid at 2.30 P.M. The gate pass No. 1604 dated 8-11-1977, was the only gate pass issued for 700 tins of vegetable products on 8-11-1977, at Hoshiarpur. As it was issued at 15.40 hrs. it could not have cleared the consignment, in question. So, the consignment was cleared without cover of gate pass or any other valid document. One more allegation was made, but it was dropped during the adjudication, so it is not necessary to recite details of that allegation. Show cause notice was issued and on adjudication, the Dy. Collector held that both the consignments were cleared without cover of gate pass or any other valid document and consequently without payment of duty and were removed clandestinely. So, he ordered as under:
(a) “The appropriate duty leviable on 1400 tins (of 16.5 kgs. each) of vegetable product which has been established to have been removed clandestinely should be paid within a month of the date of receipt of this Order by the assessee.
(b) The seized 23 tins (of 16.5 kgs. each) of vegetable product which were a part of the consignment of 700 tins admittedly received by M/s. Purshotam Lal Vishwa Nath, Jullundur on 7-11-1977 on which Central Excise duty was not paid and which was liable to confiscation, are confiscated under Rule 173Q of the Central Excise Rules, 1944. These are allowed to be redeemed on payment of a fine of Rs. 500/- (Rupees five hundred only).
(c) The seized truck is confiscated under Rule 173Q of the Central Excise Rules, 1944; it is allowed to be redeemed on payment of a fine of Rs. 50,000/-(Rupees fifty thousand only) and
(d) A personal penalty of Rs. l.00,000/- (Rs. one lakh only) is imposed on M/s. Nav Bharat Banaspati & Allied Industries, G.T. Road, Doraha, Distt. Lud-hiana.”
2. The appellant went in appeal, but the Collector (Appeals) dismissed the same. So, the appellant has preferred this appeal.
3. We have heard Sh. A.K.S. Bedi, Ld. Advocate for the appellant and Sh. G. Bhushan, Ld. S.D.R. for the Revenue.
4. L.A., Sh. Bedi made following submissions:
“As far as the first allegation is concerned, as stated in the Order-in-Original itself, the consignment was originally removed under the valid gate pass, and it was destined for their own factory at Hoshiarpur but instead, it was diverted to Jallandhar. That would not make it a clandestine removal. As far as the second allegation is concerned, the Ld. Advocate submitted that as stated in the O/O itself, only one gate pass was issued on that date. There is some discrepancy in the time because to save time and to expedite the transport, the appellant usually sends his man in advance to the Octroi Check Post so that he can complete the octroi formalities and make payment. So, it usually happens that octroi is paid earlier than the exact time of arrival of consignment. That may be an irregularity from the point of view of octroi authorities, but there is nothing illegal as far as Central Excise Act or Rules are concerned.
5. The Ld. S.D.R. reiterated arguments advanced by.the Dy. Collector and Ld. Collector (Appeals).
6. We have carefully perused the records and considered the arguments advanced by both sides. The Department has not made any investigation as to what happened to the consignment which was cleared under the gate pass and which was destined for Hoshiarpur. If the consignment, which reached at Jallandhar, was cleared without cover of gate pass, then naturally, the consignment which was cleared under cover of gate pass, must have reached somewhere. There is no investigation on this point. Moreover, there is no investigation to show that there was any clandestine manufacture. If there was no clandestine manufacture, there cannot be any clandestine clearance because the appellant has to account for raw-material and the quantity manufactured also. So, only because the consignment which was originally destined for Hoshiarpur, was diverted to Jallandhar, it could not be said that the consignment was cleared clandestinely and was not covered under the gate pass which was validly issued initially. The adjudicating authority held it to be violation of Rule 52(A) (as alleged in the show cause notice).
The relevant Rule reads as under :
“RULE 52A. Goods to be delivered on a gate pass. –
(1) No excisable goods shall be delivered from a factory except under a gate pass signed by the owner of the factory and countersigned by the proper officer.”
7. We do not understand as to how in the present case, the appellant could be alleged to have violated provisions of the said Rule.
8. As far as the second allegation is concerned, admittedly, the one gate pass was issued. The Department has not made any inquiry as to which was the consignment cleared under that gate pass, if it did not relate to the consignment, in question, and what happened to that consignment. All these facts could have been easily verified but no such effort had been made. So, only because, there is some discrepancy in the time and only because the octroi appeared to have been paid earlier, it could not be conclusively said that the consignment, in question, was removed clandestinely. Admittedly, the registration No. of the motor truck was the same that is the one which was shown in the Octroi Receipt was the same as shown in the gate pass. The adjudicating authority has held that the same truck could not be present at two places at the same time and so in his opinion, the party might be using two trucks separately for the transportation of his products under one and the same registration No. This is a very serious allegation and based upon surmise only. No transporter can operate two trucks under one registration No. and it cannot be done without connivance of State Transport Authority. It does not appear from the record that the Central Excise authorities had made any enquiry with the State Transport Authority. So, such conclusion cannot be drawn without any basis. In the circumstances, the explanation advanced by the appellant is quite plausible and possible.
9. In the light of above discussion, we are satisfied that findings are based more upon surmise than any valid evidence. So, the appeal requires to be allowed. So, we pass the following final order:
The appeal is allowed and the impugned order is set aside with consequential relief to the appellant, if any.