Tribunal overturns order due to clerical error, emphasizes substantiated allegations and thorough verification

The Tribunal allowed the appeal, setting aside the Order-in-Appeal alleging a shortage of Cenvated input Rolling Scrap due to a clerical error. The appellant's argument of a clerical mistake was supported by revised ER-4 submissions and proper record-keeping, while the Revenue's lack of thorough investigation and reliance on the ER-4 difference was criticized. The Tribunal emphasized the need for substantiated allegations and thorough verification, ultimately finding the demand unsustainable and granting the appeal with consequential benefits.

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Issues: Alleged shortage of Cenvated input Rolling Scrap due to clerical error

Analysis:
The appeal was filed against the Order-in-Appeal passed by the Commissioner of G.S.T. & Central Excise, alleging a shortage of Cenvated input Rolling Scrap due to a clerical mistake. The Show Cause Notice highlighted the difference in the closing balance of Rolling Scrap as per ER-4 submissions, leading to the allegation of intentionally suppressing the shortage of Cenvated inputs. The Order-in-Original confirmed the proposals, prompting the appellant to challenge the Commissioner's decision in this appeal.

Analysis:
During the hearing, the appellant argued that the alleged difference in closing stock was a result of a clerical error, supported by the submission of a revised/corrected ER-4 and proper maintenance of statutory records. The Department's failure to investigate further despite the revised returns and absence of discrepancies in other records like RG-1 and ER-1 returns were emphasized by the appellant to refute the allegations.

Analysis:
In contrast, the Revenue contended that the appellant lacked proper documentation regarding input receipt, usage, and disposal at their premises. The authenticity of computer printouts submitted by the appellant was also questioned by the Revenue.

Analysis:
Upon reviewing the documents, the Tribunal noted the appellant's consistent claim of a clerical error, emphasizing the absence of discrepancies in ER-1 returns and other supporting evidence. The Tribunal criticized the Revenue for not conducting a thorough investigation and relying solely on the difference in the ER-4 return.

Analysis:
The Tribunal reiterated the principle that allegations must be substantiated with proof and criticized the Revenue for not exploring other avenues of verification, such as examining the balance-sheet or ledger accounts. Ultimately, the Tribunal found the demand based on the alleged difference unsustainable and set aside the impugned Order, allowing the appeal with consequential benefits.

Analysis:
In conclusion, the Tribunal allowed the appeal, highlighting the lack of concrete evidence supporting the alleged shortage of Cenvated input Rolling Scrap and emphasizing the importance of thorough investigation and substantiation of allegations in such cases.

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