1 IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL ORIGINAL ORIGINAL CIVIL JURISDICTION CIVIL JURISDICTION CIVIL JURISDICTION CENTRAL CENTRAL CENTRAL EXCISE EXCISE EXCISE APPEAL NO.53 OF 2007 APPEAL NO.53 OF 2007 APPEAL NO.53 OF 2007 The The The Commissioner of Central .. Appellant Commissioner of Central .. Appellant Commissioner of Central .. Appellant Excise, Excise, Excise, Thane-1 Thane-1 Thane-1 vs vs vs M/s M/s M/s Hindustan Coca Cola.. Hindustan Coca Cola.. Hindustan Coca Cola.. Respondents Respondents Respondents Mr.Y.S.Bhate Mr.Y.S.Bhate Mr.Y.S.Bhate with with with Mr.S.D.Bhosale and Mr.S.D.Bhosale and Mr.S.D.Bhosale and Mr.H.P.Chaturvedi Mr.H.P.Chaturvedi Mr.H.P.Chaturvedi for Appellant for Appellant for Appellant Mr.Vikram Mr.Vikram Mr.Vikram Nankani Nankani Nankani with Mr.Madhav Baya for with Mr.Madhav Baya for with Mr.Madhav Baya for Respondents Respondents Respondents CORAM CORAM CORAM : : : F.I.REBELLO AND F.I.REBELLO AND F.I.REBELLO AND R.S.MOHITE, R.S.MOHITE, R.S.MOHITE, JJ JJ JJ DATED DATED DATED : : : 10th January, 2008 10th January, 2008 10th January, 2008 P.C. P.C. P.C. 1.1.1. The revenue has preferred this appeal on the The revenue has preferred this appeal on the The revenue has preferred this appeal on the questions questions questions (A) to (D) as set out in para 5 of the (A) to (D) as set out in para 5 of the (A) to (D) as set out in para 5 of the appeal appeal appeal memo. At the outset, we may mention that memo. At the outset, we may mention that memo. At the outset, we may mention that the the the respondents have various bottling plants. The respondents have various bottling plants. The respondents have various bottling plants. The tribunal tribunal tribunal in its order noted that in respect of an in its order noted that in respect of an in its order noted that in respect of an identical identical identical allegations of another unit of the same allegations of another unit of the same allegations of another unit of the same appellant appellant appellant situated at Pune show cause notice was situated at Pune show cause notice was situated at Pune show cause notice was issued. issued. issued. The Commissioner, Central Excise, Pune The Commissioner, Central Excise, Pune The Commissioner, Central Excise, Pune vacated vacated vacated the notice after taking into account the notice after taking into account the notice after taking into account various various various factors like loss and wastage occuring at factors like loss and wastage occuring at factors like loss and wastage occuring at various various various stages of manufacture. stages of manufacture. stages of manufacture. 2.2.2. In so far as the present appeal is concerned, In so far as the present appeal is concerned, In so far as the present appeal is concerned, the the the tribunal in the matter of burden of proof tribunal in the matter of burden of proof tribunal in the matter of burden of proof relied relied relied on the judgments of the Supreme Court in on the judgments of the Supreme Court in on the judgments of the Supreme Court in Oudh Oudh Oudh Sugar Mills Ltd vs Union of India (1978) Sugar Mills Ltd vs Union of India (1978) Sugar Mills Ltd vs Union of India (1978) E.L.T. E.L.T. E.L.T. (J172) (SC) to hold that allegations of (J172) (SC) to hold that allegations of (J172) (SC) to hold that allegations of 2 clandestine clandestine clandestine production and removal based only on production and removal based only on production and removal based only on calculations calculations calculations of raw material fed into the process of raw material fed into the process of raw material fed into the process or or or on working of the machinery as noticed during on working of the machinery as noticed during on working of the machinery as noticed during test test test inspection cannot be upheld in the absence of inspection cannot be upheld in the absence of inspection cannot be upheld in the absence of any any any tangible tangible tangible evidence on record. The Supreme Court evidence on record. The Supreme Court evidence on record. The Supreme Court specifically specifically specifically noted that the average production noted that the average production noted that the average production cannot cannot cannot be be be made the basis for issuance of show cause made the basis for issuance of show cause made the basis for issuance of show cause notice. notice. notice. In the instant case, it has come on record In the instant case, it has come on record In the instant case, it has come on record that that that the respondents themselves had fixed norms of the respondents themselves had fixed norms of the respondents themselves had fixed norms of production production production for their units. The tribunal also for their units. The tribunal also for their units. The tribunal also considered considered considered in its common order in the case of in its common order in the case of in its common order in the case of Pepsico Pepsico Pepsico India Holdings Ltd vs Commissioner of India Holdings Ltd vs Commissioner of India Holdings Ltd vs Commissioner of Central Central Central Excise, Excise, Excise, Mumbai-II (2000) (117) E.L.T. 659. Mumbai-II (2000) (117) E.L.T. 659. Mumbai-II (2000) (117) E.L.T. 659. The The The question that we are called upon to answer is question that we are called upon to answer is question that we are called upon to answer is whether whether whether question (A) as formulated considering the question (A) as formulated considering the question (A) as formulated considering the judgment judgment judgment in Oudh Sugar Mills Ltd (supra) arises in Oudh Sugar Mills Ltd (supra) arises in Oudh Sugar Mills Ltd (supra) arises from from from the order. In the instant case, though order. In the instant case, though order. In the instant case, though statements statements statements were recorded they were in respect of were recorded they were in respect of were recorded they were in respect of the the the norms norms norms which the respondents had set for itself. which the respondents had set for itself. which the respondents had set for itself. The he he tribunal tribunal tribunal recorded a finding that the appellants recorded a finding that the appellants recorded a finding that the appellants herein herein herein had based the purported evasion of duty on had based the purported evasion of duty on had based the purported evasion of duty on shortfall shortfall shortfall in production and this was not in production and this was not in production and this was not permissible. permissible. permissible. We cannot find fault with the We cannot find fault with the We cannot find fault with the findings findings findings recorded by the tribunal on that count. recorded by the tribunal on that count. recorded by the tribunal on that count. 3.3.3. In so far as question (B) is concerned, in our In so far as question (B) is concerned, in our In so far as question (B) is concerned, in our opinion, opinion, opinion, Bhoormal’s case 1983 (13) ELT. 1546 (SC) Bhoormal’s case 1983 (13) ELT. 1546 (SC) Bhoormal’s case 1983 (13) ELT. 1546 (SC) would would would not be applicable. The test to be satisfied not be applicable. The test to be satisfied not be applicable. The test to be satisfied isisis in terms of Oudh Sugar Mills (supra). The in terms of Oudh Sugar Mills (supra). The in terms of Oudh Sugar Mills (supra). The second second second question therefore, would not arise. question therefore, would not arise. question therefore, would not arise. 3 4.4.4. In so far as question (C) is concerned, there In so far as question (C) is concerned, there In so far as question (C) is concerned, there isisis no no no material on record showing that there was any material on record showing that there was any material on record showing that there was any clandestine clandestine clandestine removal of excess unaccounted removal of excess unaccounted removal of excess unaccounted production. production. production. In fact, we asked learned counsel to In fact, we asked learned counsel to In fact, we asked learned counsel to show show show us any orders of the authorities below which us any orders of the authorities below which us any orders of the authorities below which has has has recorded this finding. There is no such recorded this finding. There is no such recorded this finding. There is no such finding. finding. finding. In our opinion, therefore the three In our opinion, therefore the three In our opinion, therefore the three questions questions questions as framed would not arise from the order as framed would not arise from the order as framed would not arise from the order of of of the tribunal. Consequently, there is no merit the tribunal. Consequently, there is no merit the tribunal. Consequently, there is no merit inin in the appeal which is accordingly dismissed. the appeal which is accordingly dismissed. the appeal which is accordingly dismissed. (F.I.Rebello, (F.I.Rebello, (F.I.Rebello, J) J) J) (R.S.Mohite, (R.S.Mohite, (R.S.Mohite, J) J) J)