Custom, Excise & Service Tax Tribunal
Meerut-I vs Jyoti Ingots Pvt Ltd on 7 August, 2018
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE
TRIBUNAL
REGIONAL BENCH : ALLAHABAD
COURT No. I
APPEAL No.E/70052/2015-EX[DB]
(Arising out of Order-in-Original No.13/Commer./Meerut/2015 dated
29/05/2015 passed by Commissioner, Central Excise & Service Tax,
Meerut)
Commissioner, Customs, C.Excise & Service Tax, Meerut Appellant
Vs.
M/s Jyoti Ingots Pvt. Ltd. Respondent
Appearance:
Shri Gyanendra Kumar Tripathi, Asstt. Commissioner (AR) for Appellant Shri Aalok Arora, (Adv.) for Respondent CORAM:
Hon'ble Mrs. Archana Wadhwa, Member (Judicial) Hon'ble Mr. Anil G. Shakkarwar, Member (Technical) Date of Hearing : 07/08/2018 Date of Decision : 07/08/2018 FINAL ORDER NO.72064/2018 Per: Archana Wadhwa Being aggrieved with the order passed by Commissioner vide which he has vacated the show cause notice issued to the Respondents, Revenue has filed the present appeal. We have heard Shri Gyanendra Kumar Tripathi, A.R. appearing for Revenue and Shri Aalok Arora appearing for the Respondents.
2. As per facts on record the respondents are engaged in the manufacture of M.S. Ingots by using various raw materials on which they were availing Cenvat Credit. Their factory was visited by the Central Excise officer on 2 APPEAL No.E/70052/2015-EX[DB] 30.09.2009, who conducted various checks and verifications. Stock taking of the final product as also the raw materials resulted in certain shortages, for which a separate show cause notice was issued and is not the subject matter of the present proceedings.
3. During the course of visit of officers, they found two Induction Furnace installed in the factory of 4 M.T. and 3 M.T. per head capacity and the sanctioned electricity load was of 2400 KVA. Shri Naveen Kansal, Authorised Signatory of the appellant deposed that they had started production with effect from 2005 with the first Induction Furnace having capacity of 4 M.T. and the second Induction furnace having capacity of 3 M.T. was installed in their factory in August 2009, which was still under trial on the date of visit of officers.
4. The Revenue also undertook simultaneous searches in the factory of one M/s Shamli Sugar Work (P) Ltd. and it was found that some records pertaining to production and clearances of MS ingots were lying in their factory. The same were seized by the officers. Statement of Shri Sanjeev accountant and Authorised Signatory of M/s Shamli Sugar Works (P) Ltd, Muzaffarnagar was recorded wherein he deposed that the said records recovered from their premises were written and maintained by Shri Naveen Kansal, Authorised Signatory of M/s Jyoti Ingots Pvt Ltd. 3 APPEAL No.E/70052/2015-EX[DB] who was also working as a part time accountant for M/s Shamli works (P) Ltd. Shir Naveen Kansal, Authorised Signatory of M/s Jyoti Ingots Pvt Ltd. in his statements recorded on 25.03.2010 admitted the above position.
5. Based upon the above as also the scrutiny of records resumed from the appellant's factory as also from the factory of M/s Shamli Sugar Works (P) Ltd., Revenue entertained a view that the appellant was indulging in clandestine removals. Accordingly, further investigations were undertaken and the Directors of M/s Jyoti Ingots were summoned and their statements recorded.
6. On the above basis, proceedings were initiated against the Respondent by way of issuance of Show Cause Notice alleging clandestine removal and proposing demand of duty of Rs.82,33,223/-along with proposal to impose penalties. The said show cause notice stand adjudicated by the Commissioner wherein after taking assessee's contention into consideration as also the various records, he held that the allegations of clandestine removal are unsustainable and accordingly, dropped the proceedings. Hence, the present appeals by the Revenue.
7. On going through the impugned order we find that the entire case of the Revenue is based upon the entries made in the recovered records read with statement of various persons. However, Commissioner has clearly observed that 4 APPEAL No.E/70052/2015-EX[DB] the second furnace though installed in the factory but was not in operation inasmuch as the said fact stands deposed by various deponents in the statement itself. He has also referred to the Panchnama proceedings which state that at the time of the visit of the factory only one furnace was working and the other was filled with iron scrap etc. The Panchnama has further recorded that the Directors has informed the visiting officer that even though 2400 KVA electricity load stands sanctioned but the same is still to be connected. As such he has arrived at a finding that only one furnace was working and the Revenue's case which is primarily based upon the working of the second furnace cannot be sustained.
8. The Adjudicating Authority has also verified the fact that the entries made in the so called incriminate documents fully match with the clearances reflected in the RG-1 record. Each and every entry has been dealt with by him and has been found to be cleared on payment of duty. Though there are minor variations on the comparison of both the entries but the Adjudicating Authority has observed that such differences, which are very minor are on account of wrong entries as almost all the entries have been found to have been cleared on payment of duty by reflecting the same in RG-1 register.
5 APPEAL No.E/70052/2015-EX[DB]
9. Appearing the detailed discussion and findings of the Adjudicating Authority which do not stand rebutted effectively by the Revenue in the memo of appeal, we also note the entire case of the Revenue is based upon entries made in the record resumed from assessee and there is no evidence of establishing clandestine activity on the part of the assessee. Even the separate case made out against them based upon the shortages of the raw material and final product stand allowed by Commissioner (Appeals) by way of different Order-In-Appeal, in the absence of any cogent evidences. We fully agree with the Adjudicating Authority that the demand of duty cannot be upheld against the assessee on the allegations of clandestine removal.
9. Accordingly, we find no infirmity in the impugned order and Revenue's appeal is rejected.
(Pronounced in Court)
(Anil G. Shakkarwar) (Archana Wadhwa)
Member (Technical) Member (Judicial)
Nihal