2024 (7) TMI 1073 - HC - Central Excise

Appeal Dismissed: Tribunal's Decision on Short Production Duty Upheld Due to Lack of Substantial Evidence.

The HC dismissed the appeal against the CESTAT's decision, which set aside the imposition of short production duty and penalty on the respondent. The ... Levy of short production duty - ratio of 93% finished goods viz-a-viz inputs consumed - setting aside the OIO without considering material facts - violation of principles of natural justice - HELD THAT:- The undisputed facts are that apart from the variation in production percentage as compared to the norms fixed by the ‘SAIL’, there was no other material available with the Department of the alleged excess production being cleared without payment of duty. The variation as per the Department was of only 2%. Further that the Plant and Machinery used by the respondent was not of the latest technology as that of the SAIL. The findings of Tribunal have not been challenged or disputed in the present appeal. During the course of arguments, no factual distinction between the facts of the present case and of M/S H.R. STEELS PVT. LTD. VERSUS CCE & ST, ALWAR. [2018 (12) TMI 1950 - CESTAT NEW DELHI] has been made out. The addition was made only on the sole ground of 2% variation in production output of the respondent as compared to SAIL. No question of law much less substantial question of law is involved - appeal dismissed. Issues: Appeal against Customs, Excise & Service Tax Appellate Tribunal order regarding short production duty on finished goods clearance without payment of duty and penalty imposition.In this case, the appellant filed an appeal against the order of the Customs, Excise & Service Tax Appellate Tribunal, New Delhi, which initiated proceedings against the respondent for short production duty and penalty imposition. The appellant alleged that the respondent had a 93% ratio of finished goods to inputs consumed, while Steel Authority of India Limited (SAIL) had a norm of 95% production. The Tribunal set aside the addition of duty and penalty, leading to the present appeal. The appellant argued that the Tribunal did not discuss the merits of the case and only relied on a previous decision. The respondent defended the impugned order. The main question of law proposed was whether the Tribunal was correct in setting aside the order without considering material facts and Central Excise Rules. The undisputed facts revealed a 2% variation in production compared to SAIL's norms, with no evidence of excess production cleared without duty payment. The Tribunal found that the issue was similar to a previous case and that the demand was not sustainable due to lack of evidence from the Department regarding raw materials, technology, or transportation. The appellant did not challenge the Tribunal's findings, and no substantial question of law was identified. Consequently, the appeal was dismissed.