Tribunal grants waiver of duty and penalty in Rs.3.55 crore case due to insufficient evidence

The Tribunal granted the total waiver of pre-deposit of duty and penalty amounting to Rs.3.55 crore each in a case involving discrepancies in the quantity of granulated slag cleared by the Appellant. The Tribunal found the Revenue's demand solely based on the quantity difference insufficient, considering the circumstances and lack of corroborative evidence. The waiver was granted, and the recovery of dues was stayed during the Appeal's pendency.

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Issues:
Application for waiver of predeposit of duty and penalty based on difference in quantity of cleared goods between two statements.

Analysis:
The case involved an Application seeking waiver of predeposit of duty amounting to Rs.3.55 crore and an equal amount of penalty. The Appellant, engaged in manufacturing iron and steel products, produced granulated slag classified under Chapter Sub Heading 26180000 of CETA, 1985. Discrepancies arose in the quantity of granulated slag cleared as per their operational statistical report and the ER-1 Returns for the financial years 2004-05 to 2007-08. The Revenue alleged clearances without payment of duty due to the difference in quantity. The Appellant explained that a significant portion of molten slag was sold to another company for conversion into granulated slag, which was duly cleared with duty payment. The Tribunal noted that the Revenue's demand was solely based on the discrepancy in the quantity of granulated slag between the two statements. However, considering the agreement between the parties, the location of the other company within the same premises, and the fact that the other company had cleared granulated slag on payment of duty, the Tribunal found it difficult to accept the Revenue's claim without corroborative evidence. Consequently, the Tribunal granted a total waiver of pre-deposit of dues adjudged and stayed the recovery during the pendency of the Appeal.

Conclusion:
The Tribunal, after considering the arguments from both sides and examining the records, found that the Appellant had made a prima facie case for the total waiver of pre-deposit of dues adjudged. The Tribunal highlighted the lack of corroborative evidence supporting the Revenue's claim of clearances without payment of duty, given the circumstances of the agreement and the location of the other company within the same premises. As a result, the Tribunal granted the waiver and stayed the recovery of dues, allowing the Stay Petition.

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