Tribunal overturns excise duty demand and penalty due to lack of evidence.

The Tribunal allowed the appeal against the adjudication order confirming the demand of excise duty and imposing a penalty on the appellant. It was held that the Revenue failed to provide evidence that the increased prices represented excise duty as required by Section 11D of the Central Excise Act. The Tribunal emphasized the need for factual evidence and noted that the prices were determined by a committee, not solely to collect excess excise duty. As a result, the impugned order was set aside, and the appeal was allowed.

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Issues involved: Appeal against adjudication order confirming demand of excise duty and imposing penalty u/s 11D(2) of the Central Excise Act.

Summary:
The appeal was filed against an order confirming a demand of excise duty and imposing a penalty on the appellant. The appellant contended that duty was paid on assessable value prevailing at the depot at the time of goods removal, as per Administered Price Mechanism. The appellant argued that no representation of excise duty was made in the invoices issued to buyers. The Revenue claimed that the increased prices were related to the excise duty increase in the Union Budget. The Tribunal noted that Section 11D requires evidence that amounts collected represent excise duty, which was lacking in this case. The Tribunal also highlighted a circular emphasizing the need for factual evidence. It was observed that the prices of petroleum products were fixed by a committee, and there was no proof that the price increase was to collect excess excise duty. The Tribunal found that the Revenue failed to prove that the increased prices represented excise duty, thus setting aside the impugned order and allowing the appeal.

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