SC: Electricity Dues over 2 Years Recoverable only if Shown Continuously as Outstanding  ||  Allahabad HC Criticises UP Govt for Using Goondas Act as a ‘Tool of Oppression’  ||  Gujarat HC: Complaint Made in Good Faith does not Amount to Defamation  ||  Allahabad HC: Bar Association Membership Disputes Are Private, Outside Writ Jurisdiction  ||  P&H HC: Section 147A Income Tax Act Unconstitutional; Legislature Can’t Override Court Findings  ||  Karnataka HC: Refusing to Return Child’s Volleyball, Asking for Parent Not Abetment of Suicide  ||  Can an IBC Resolution Plan Survive the Death of its Proponent? NCLAT Answers  ||  Supreme Court: Rape Conviction Possible Without S.376 Charge if POCSO Case Fails on Age Proof  ||  SC: Mere Long Possession Can't Establish Adverse Possession; Hostile Intent is Required  ||  Supreme Court Finds Gaps in FSSAI’s Proposed Warning Labels for Foods High in Fat, Sugar and Salt    

Satya Power & Ispat Ltd vs Commissioner of Central Excise - (Customs, Excise and Service Tax Appellate Tribunal) (13 Sep 2022)

Mere shortage cannot ipso facto lead to the allegation of clandestine removal

MANU/CE/0328/2022

Excise

Present appeal has been filed challenging the Order-in-Appeal passed by the Commissioner (Appeals), by which the learned Commissioner dismissed the appeal filed by the Appellant by holding that the order passed by the Adjudicating Authority for denial of credit and imposition of penalty does not warrant any interference.

In the instant case, while explaining the procedure, learned counsel submits that during the manufacturing process of the sponge iron, iron ore fines are generated at the time of screening/grading and crushing, which is nothing but waste and in order to keep the production at a constant pace the aforesaid process of screening is essential and indispensable and iron ore and coal fines contents have to be removed else it would stick on the inner wall of the kiln and reduce the space inside the kiln, called accretion. Therefore it can safely be concluded that the fines etc are by-product or incidental product which cannot be said to be inputs. This issue is decided in favour of the Appellant.

So far as short receipt of 268.420 MT of coal is concerned on which department is demanding duty, that is also not sustainable. There is no allegation or any evidence of clandestine removal of the said quantity of coal. Mere shortage cannot ipso facto lead to the allegation of clandestine removal. According to learned counsel, the said short receipt is sometimes due to transit loss/theft and as per industrial practice ± 4% is permissible. Since this short receipt cannot be treated as clandestine removal therefore, there is no reason not to accept the submission/explanation given by the learned counsel. Therefore, demand cannot be sustained.

Regarding the issue of wrongly availed Cenvat credit of Rs.9,768 on input service paid on GTA service against sponge iron received back from the customers is concerned, this issue is also covered in favour of the assessee in view of the decision of a co- ordinate Bench of the Tribunal in the matter of Chitrakoot Steel & Power Pvt. Ltd. Vs. CCE, Chennai in which it has been held that no demand can be made for input services, if the finished goods are received back. As in view of facts of this case, all the issues involved are decided in favour of the Appellants. Appeal allowed.

Tags : DEMAND   CONFIRMATION   PENALTY  

Share :        

Disclaimer | Copyright 2026 - All Rights Reserved