2014 (7) TMI 527

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....ct, 1944. Proceedings were initiated against them and a show cause notice was issued alleging therewith, that they had suppressed the production and cleared the goods without payment of duty. The impugned show cause notice was adjudicated and the ld. Adjudicating Commissioner confirmed the demand of Rs. 1,01,25,018/- along with imposition of equal amount of penalty. It is his contention that the allegations of the Department were mainly based on the input/output norm, which is 72-73% of MS Ingots produced from MS Scrap/Sponge Iron or mixture of both, in this case, was found to be low, compared to the industry average. The excess quantity of ingots produced is alleged to be used for manufacture of MS Bars and Rods which were cleared without ....

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....ating suppression of production or as the case may be, the clandestine clearance. He cited a number of case laws wherein orders for evasion of duty were set aside, in absence of any positive evidence showing the suppressed production and clandestine removal. In this regard, he relied upon the judgment of the Tribunal in the case R A Castings Pvt. Ltd. vs. CCE, Meerut-I, 2009 (237) ELT 674 (Tri.), holding that electricity consumption alone could not be the only factor for determining the duty liability, especially when no norms were prescribed, and there is no evidence of unaccounted purchase of raw materials etc. This Order has been upheld by the Hon'ble High Court of Allahabad, as reported in 2011 (269) ELT 337 (All.). The appeal filed....

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....stine clearance. We, however, find that the raw material suppliers have not issued any test report indicating the grade of Sponge Iron supplied as above. We, further, find that the Revenue has relied upon the statement of Shri Arif Ali, Manager of the Company who categorically stated that the entire data, subsequent to the period, December, 2008, was incorrect. This shows that the entire records were manipulated. Besides, it is the finding of the ld. Adjudicating Commissioner that all along, the Applicant has been maintaining the records, consistently showing the fixed ratio of production of MS Ingots as 72.8% during the period, 2007-08, irrespective of the ratio of the consumption of MS Scrap and the Sponge Iron, which cannot be the same, ....