Point of Law: It is equally well settled that even when from the evidence two inferences are possible, then the one drawn by the Tribunal below should be opted.

JUDGMENT :

Arun Dev Choudhury, J

1. Heard Mr. S.C Keyal, learned counsel appearing for the appellant. Also heard Dr. A. Saraf, learned senior counsel for the respondent.

2. The present appeal under section 35G of the Central Excise Act, 1944 is preferred assailing the order No.FO/78328/2017 dated 30.11.2017 passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Eastern Zonal Bench, Kolkata in Appeal No.E/446/2008-DC.

3. The present appeal was admitted by this Court under its order dated 20.02.2019 for hearing by formulating the following substantial questions of law:

I. Whether the CESTAT was justified in concluding that the exemption as granted to the respondent was justified and in that light whether the conclusion as reached is perverse for non-consideration of the evidence said to have been produced by the appellant herein?

II. Whether the order is perverse and in that regard as to whether the CESTAT has taken into consideration the materials available on record?

4. The facts:

Before endeavouring into determining the substantial questions of law, the facts giving rise to the present appeal may be summed up as under:

I. A show cause notice dated 29.10.2007 was issued to the respondent alleging that respondent misused benefit of exemption notification No.32/99CE dated 08.07.1999 and availed undue benefit of excise duty exemption by way of erroneous refund amounting to Rs.66,89,962.00 (Rupees sixty six lakhs eighty nine thousand nine hundred and sixty two) during the period from December 2002 to August, 2005.

II. The basic allegations levelled in the aforesaid show cause notice dated 29.10.2007 were to the extent that acting on intelligence input, an enquiry was conducted by visiting the industrial unit of the assessee on 18.10.2005 and it was found that an industrial unit by the name and style of “M/sPolyplast Products” was functioning on the same plot of land where the respondent units were said to be operating till 31.03.2002. The said Polyplast products had surrendered its registration to the Central Excise Authority on 09.04.2002, though the assessee unit had applied for benefit of exemption and was granted such exemption on 10.12.2002. It was also alleged that during the investigation it was found that the invoice/bills in respect of the machines shown to have been purchased by the assessee unit were forged and fabricated, except two invoice/bills pertaining to the year 2003 for new products. It was also alleged that in terms of the exemption notification, the commercial production of such exempted units should have commenced on or after 24.12.1997 and there was no physical existence of the assessee unit till 31.01.2002 over the plot of land in question and the proprietor of the unit has also admitted in his statement that production started on 28.11.2005 after the respondent unit obtained central excise registration. Accordingly, it was alleged that the proprietor of M/s Polyplast products with an intention to have exemption benefit renamed the earlier unit as “M/s Rajdhani Tele Products” and obtained a new central excise registration. It was further alleged that the respondent unit was in existence only on paper and that during investigation, it came to light that the vendor from whom the machineries were shown to have been purchased had denied selling any such products to the respondent unit.

III. After considering the matter including the statements recorded by the Investigating Authority, the Commissioner of Central Excise, Shillong under its order dated 29.07.2008 confirmed the demand of the duty to the tune of Rs.66,89,962.00 holding that the respondent unit was ineligible for the benefit of exemption notification in question and accordingly, ordered recovery of the said amount along with interest and penalty.

IV. Being aggrieved, the respondent unit preferred an appeal before the Customs Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata.

5. Findings of the Commissioner of Excise:

The Commissioner o