2015 (4) TMI 1034

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....Base Oil. On verification of input invoices of Base oil, it was noticed that appellants had availed duty on full quantity as shown in the invoices/bills etc. However on scrutiny of the documents viz. AC-13, OUT TURN report vis-a-vis invoices, it was noticed that appellant had received base oil in short quantity. Revenue issued show cause notice F. No. V. Adj.(30) Ch-I/CR-61/IOCL/Commr./M-II/09 dated 5/1/2010 wherein demand of duty of Rs. 1,64,40,644/- was made in respect of short receipt of inputs i.e. base oil during the period December, 2004 to March 2009 invoking extended period of limitation. It was also proposed to recover interest and impose penalty under Rule 15 (1) of Cenvat Credit Rules, 2004 read with Section 11AC of Central Excis....

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....i Vs. Bhuwalka Steel Industries Ltd. [2010(249)E.L.T. 218(Tri- LB)] has discussed the matter in detail with reference to the Cenvat Credit Rules and in para 12 have laid down criterion. It was further submitted that the Commissioner has taken note of the said decision of the Tribunal and has discussed the same in detail in his order and has observed that the permissible limit in case of lubricated base oil stock is 0.1% and therefore benefit of 0.1% can be given. It was further submitted that in the order internal page 19 in the last paragraph, Commissioner has observed that the demand raised for the period December, 2008 to March 2009 is sustainable and liable to be confirmed as Cenvat Credit is availed in case of their receipt of inputs a....

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....mitation. The goods involved in the present case are lubricating base oil. Ld. Counsel for the appellant has produced copy of supplement to the manual of departmental instruction on excisable manufacture product. In the said manual different limit has been prescribed for different goods and different method of transfer etc. In the case of lubricating base oil the permissible limit is 0.1 %. We also note that Larger Bench of this Tribunal in the case of Bhuwalka Steel Industries Ltd(supra) has gone into details of various factors to be considered while permitting various losses on their receipt of the goods for purpose of availment of Cenvat credit under Rule 3(1) of Cenvat Credit Rules. We also note that the Commissioner in the impugned ord....