Manufacturer Wins Relief Against Rs. 2.3 Crore Duty Demands Based on Theoretical Input-Output Ratios Under Section 36B

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....CESTAT set aside multiple duty demands totaling over Rs. 2.3 crores against appellant manufacturer of LABSA. Primary allegations of clandestine manufacture and removal based on theoretical input-output ratios (1:1.475 vs 1:1.45) were rejected due to lack of chemical examination. Demands based on batch charges, computer printouts, and diary entries were dropped for insufficient evidence and non-compliance with Section 36B requirements. Claims regarding spent acid clearance and CENVAT credit denial were invalidated. Only the matter of Rs. 3,27,046/- regarding consignment agent sales was remanded for verification. Associated penalties on appellant and co-appellants were set aside, as demands were primarily based on assumptions without corroborative evidence of unauthorized raw material procurement.....