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2023 (10) TMI 1159 - CESTAT KOLKATACENVAT Credit - allegation of contravention of rule 3(5) of Cenvat Credit Rules - clearance of pure lead ingot on which CENVAT Credit was availed, but were sold ‘as such’ in the home market on payment of an amount as duty which was less than the amount of Cenvat Credit availed by them at the time of it’s procurement. HELD THAT:- The department has not adduced any evidence to substantiate the allegation that the Appellant has availed excess credit on the inputs and paid less duty at the time of clearance of the inputs ‘as such’. In the grounds of appeal, the department stated that the Appellant themselves are manufacturers of pure lead ingot of a quantity more than required for its captive consumption. Hence, there was no necessity for importing the pure lead ingot and then re-selling the same in the market - the allegation is very strange. In business, there is nothing wrong in manufacturing one product and importing the same to meet the market requirement. If there is any malafide intention in it, the department should have brought it out clearly with evidence. Mere allegation without any evidence is not sufficient to demand the differential duty. There is no material evidence available on record to substantiate the allegation of the department regarding excess availment of Cenvat credit on the imported pure lead ingot. Hence the allegation of excess availment of credit by the department is not sustainable - Further, the department has not adduced any evidence for diversion of Cenvat credit availed inputs ‘as such’. All the allegations of the department were only on presumption basis, without any evidence. One such allegation of the department is that during the period Sept 2010 to March 2011, the Appellant procured 1,11,808 Kgs of pure lead ingot and availed Cenvat credit. During this period they have also manufactured 13,77,957 Kgs of the same pure lead ingot and cleared the same to domestic market. Thus, allegation of the department is that there is no need to procure 1,11,808 Kgs of pure lead ingot when they themselves manufactured 13,77,957.10 Kgs of pure lead ingot during the same period - it is found that there is nothing wrong in procuring pure lead ingot from outside sources when there was a shortage. Just because they manufacture huge quantity of pure lead ingot, it does mean that they should not import the same goods to meet their requirement. Thus, the allegations are only on presumption basis without any evidence. Appeal of assessee allowed.
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