2011 (2) TMI 839

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....the case of M/s Etah Steels Pvt. Ltd., they in addition to M.S. Ingots, also manufacture Iron and Steel Castings and hubs for animal drawn vehicles. The M.S. Ingots are manufactured from scrap in induction furnace. In both the cases, the Department issued show cause notices to the appellants alleging suppression of production and clandestine removal of M.S. Ingots without payment of duty on the basis that they have under reported their production and clearances of M.S. Ingots, which is clear from the excessive power consumption for manufacture of per metric ton of Ingots 2400 unit in case of M/s Pragati Steel and 1700 units per M.T. in case of M/s Itah Steel, whereas according to the department, the average consumption should be around 1067....

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....ascertaining the average power consumption, that the machinery of one appellant cannot be compared with the machinery of other manufacturers, that other than the average power consumption per M.T., there is no other evidence collected by the department indicating that the appellants had under reported their production and clearances of M.S. Ingots, that on similar basis, cases of duty evasion had been booked by the department against R.A. Castings Pvt. Ltd. in Meerut I Commissionerate and the Tribunal in this case, vide its judgment reported in 2009 (237) E.L.T. 674 (Tri. Del.) set aside the duty demand observing that the electricity consumption cannot be the only factor for determining the duty liability in the case of an induction furnace....

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....hat the power consumption of 2104 units per M.T. in case of M/s Pragati Steel and 1700 units per M.T. in the case of M/s Etah Steel is too high, that at this rate of power consumption, the manufacture of M.S. Ingots is not commercially viable and that in view of this, there is no infirmity in the impugned orders-in-appeal.   2.3 Shri Santhanam, in rejoinder pleaded that in case of U.P. Alloys Pvt. Ltd. vs. CCE, Kanpur (supra), cited by the learned DR, an experiment for determining the average power consumption per M.T. has been conducted but the department discarding that norm, had adopted the average power consumption of some other units and had raised the duty demand, which was not allowed, while in these cases, no such experiment....