TaxTMI 
TaxTMI 
2010 (12) TMI 367
X X X X Extracts X X X X
X X X X Extracts X X X X
....e following two questions. "1. Whether the Income Tax Appellate Tribunal committed error in not considering the aspect that income tax return in the form of 3-CD Tax Reports are in nature of statutory admission of assessee about short receipt of inputs and binding to assessee? 2. Whether the Income Tax Appellate Tribunal committed error in not appreciating that there was no detail of loss of raw material while manufacturing goods?" 3. The respondent-assessee is engaged in manufacturing Plastic Lay Flat Tubing, plastic films, plastic bags etc. falling under Chapter 39 of the Central Excise Tariff Act, 1985. During the course of audit, it was observed that the assessee had furnished Form No. 3-CD under Section 44AB of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he Commissioner (Appeals), the assessee preferred appeal before the Tribunal, which came to be allowed vide the impugned order [2009 (238) E.L.T. 497 (Tri. - Ahmd.)]. 4. Assailing the impugned order of the Tribunal, Ms. Naynaben K. Gadhvi, learned Standing Counsel for the appellant submitted that the respondent-assessee had submitted 3-CD Tax Report prepared by the Chartered Accountant wherein it was admitted that raw material had been received in short quantity. That despite opportunity having been granted by the Commissioner (Appeals), the assessee did not make out any case to show that the raw material had in fact not been received in short quantity as stated in the 3-CD Tax Report. It was submitted that Form 3-CD under Section 4....
X X X X Extracts X X X X
X X X X Extracts X X X X
....that if raw material is received, the manufacturer or producer of final product is entitled to take credit of the duty paid on any inputs received in the factory. The adjudicating authority has further noted that the blow molding process of the manufacture of plastic granules requires the granules to be heated for melting, which results in certain process losses, which has been considered to be acceptable by the Board. It has further noted that the onus to prove that the raw material was short received lies on the department and there was no conclusive evidence available on record to establish that the raw material was short received/not received by the assessee. It is in the light of the aforesaid findings recorded by it that the Adjudicat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....was some process loss during blow moulding process and that the loss claimed by the assessee was not on the higher side. The Tribunal observed that the Commissioner (Appeals) had proceeded on assumptions and presumptions and not on the basis of any evidence showing less receipt of raw material in the assessee's factory and was of the view that the benefit of yield loss was required to be extended to the assessee. 8. Thus, the undisputed facts of the case are that except for the 3-CD Income Tax Return, there is no evidence on record to indicate that there was in fact shortage of raw material on account of short receipt thereof; and that the assessee had availed credit of duty as reflected in the invoices for the inputs. It was also f....