2025 (12) TMI 447

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....brief are that the appellants are engaged in the manufacture of Non-alloy Steel Ingots and were clearing the same on payment of duty. Periodical demand notices are being issued since 2007-08, on the basis of the statements of their factory manager recorded on 01.09.2006 and the supplier of induction furnace, the production capacity of which defence upon the different variables such as product mixed, quality of scrap and quality of power/electricity efficiency etc. The appellants were directed to electricity bills for the relevant period and which was considered for the consumption of electricity and production of goods. After this, it was inferred that the appellants had suppressed some quantity of production taking into consideration of as....

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....cal calculation of raising demand on the basis of such consumption of electricity cannot be maintainable in law. Law is well settled in this regard and the appellants' own case for the earlier period, this Tribunal set-aside the order confirming the demand on the basis of consumption of electricity. 7. Heard both sides and perused the documents and considered the submissions. 8. It is seen that the Show Cause Notice has been issued solely based on the electricity consumption of the induction furnace used by the Appellant. In order to allege any clandestine manufacture and clearances, the onus is on the Department to bring in several corroborative evidence in the form of purchase of inputs, manufacture of furnished goods, dispatch of f....

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....or or basis for determining the duty liability, that too on imaginary basis, especially when Rules 173E mandatorily requires the Commissioner to prescribe/fix norm for electricity consumption first and notify the same to the manufacturers and thereafter ascertain the reasons for deviations, if any, taking also into account the consumption of various inputs, requirements of labour, material, power supply and the conditions for running the plant together with the attendant facts and circumstances. The Tribunal further observed that no experiment have been conducted in the factories of the appellants for devising the consumption norms of electricity for producing on MT of steel ingots. Tribunal also observed that the electricity consumption va....

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....igh Court in W.P (C) No. 8141 of 2008 by order dated 19th November, 2008. The Division Bench of the Delhi High Court set aside the order of the Tribunal and directed reconsideration in the light of the ratio laid down in R.A. Castings Pvt. Ltd. (supra). [Emphasis supplied] 11. In the case of Sukh Sagar Metals (P) Ltd Vs Union of India, the Hon'ble Jharkhand High Court has held as under:- 5. Having heard Counsels for both the sides and looking to the facts and circumstances of the case, we, hereby, quash and set aside the Order-in-Original, dated 27-2-2015/13-3-2015 (Annexure-3 to the memo of this writ petition) mainly for the following facts and reasons : (i) Show cause notice was given by the respondents on 7-....