JUDGMENT
Arijit Pasayat, C.J.
1. Rule D.B.
Since a short point is involved, with the consent of counsel for the parties, the petition is taken up for disposal. This petition is directed against the order passed by the Customs, Excise and Gold (Control) Appellate Tribunal (in short Tribunal) while dealing with a prayer for waiver of pre-deposit of duty amounting to Rs. 30,32,433/- and penalty amounting to Rs. 30,32,433/- levied under the Central Excise Act, 1944 (in short the Act).
2. Background in which the levy was made is essentially as follows :
Central Excise officers paid a surprise visit to the unit of the petitioner. Except a chowkidar no other employee was present. Statement of the chowkidar was recorded to the effect that there were no machines and for two months there was no activity going on in the unit. Officers observed that the machines available were rusted. When the proprietor was contacted it was stated that there was no power connection and he was using a generator for drawing power and stated further that the generator had developed certain defects for which it had been sent for repairs. It was also stated that diesel meant for the generator was purchased on credit from a gas station. Enquiries were made about the alleged repair of the generator set and procurement of diesel. The person who was named as the repairer of the generator set was not found. As disclosed by petitioner, statement of some other person was also recorded who stated that he had not repaired any generator set of the unit concerned and no generator set was available with him for repair. When the gas station was contacted, it was stated that diesel was not purchased or given on credit as claimed by the petitioner. In view of the above, authorities concluded that petitioner, by adopting the modus operandi of paper transactions, had availed inadmissible credit to the tune of Rs. 30,32,433/- on the inputs which have not been actually received or purchased from the alleged parties whose details were given in Annexure-H to the show cause notice. It was also observed that duty to the tune of Rs. 30,02,637/- have been passed on to different manufacturers/traders by raising invoices without actual supply of goods covered under the invoices. In view of these it was concluded that petitioner had contravened the provisions of Rules 52A, 57A, 57G and 173G as well as Rule 226 of the Central Excise Rules, 1944 (in short the Rules). Accordingly duty and penalty as aforesaid were levied. Appeal has been filed before the Tribunal and as indicated above prayer was made for waiver of the condition relating to pre-deposit. Tribunal considered the materials and held that petitioner has not been able to make a prima facie case for waiver of pre-deposit of duty and penalty and also there was no material placed to indicate any financial hardship. However, petitioner was directed to deposit a sum of Rs. 15 lakhs on or before 23rd December, 1999 and to produce evidence of compliance on 4th January, 2000.
3. Learned counsel for the petitioner submitted that stand of the Department is contradictory and if there was no manufacturing the question of passing on duty does not arise. Additionally it is submitted that on the basis of a solitary inspection alleged to have been made and on the basis of statement of chowkidar such a huge liability should not have been imposed. Learned counsel for the respondent on the other hand pointed out that modus operandi of the petitioner has been clearly noted by the authorities. The plea that adequate opportunity was not granted to the petitioner to have his say is belied by the materials on record. It was also pointed out that the raw materials claimed to have been used were never utilised and there was no manufacture or final product and the terms of Modvat were being misused and credit have been fraudulently availed.
4. We have considered the rival submissions. We find that Tribunal has elaborately dealt with the rival stands to conclude that a prima facie case for waiver of pre-deposit was not made out. We are in agreement with the view expressed by the Tribunal. At the stage of considering the application for stay Tribunal is not required to make an in-depth analysis of the position and what is required to be seen is whether a prima fade case has been made out for waiver of pre-deposit. Even in respect of the plea relating to undue financial hardship, no acceptable material was placed to substantiate this stand. In these circumstances we find no reason to interfere with the quantum fixed by the Tribunal. However, as time for deposit is over. We extend the period for deposit till end of January, 2000.
5. The petition is accordingly disposed of.
