9911796707
TMI Blog2010 (1) TMI 521X X X X Extracts X X X X X X X X Extracts X X X X ..... of this case. A senior auditor of the department on 8-12-2006 made on an audit report, wherein the following figures were entered with regard to aluminium ingots (input) : Opening balance as on 1-4-05 1260 kgs Receipts in 05-06 48,419 kg Total 49,617 kgs Issue in 05-06 61,083 kgs Closing balance ( - ) 11,412 kgs The senior auditor himself worked out Rs. 3,22,525/- to be the total amount of Cenvat Credit said to have been availed by the assessee on aluminium ingots weighing 13,724 kgs in 2005-06. Reproducing the above figures, the department issued a show-cause notice to the assessee on 21-5-2007 seeking to recover duty of Rs. 3,22,525/- from them with interest thereon under Section 11AB as also to im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e set aside. There are more than one reasons. 3. Firstly, the show-cause notice was issued purely on the basis of audit objections without the necessary investigation which must precede action under Section 11A of the Act. In this connection, I may usefully refer to two decisions cited by the Counsel, viz., (i) Swastik Tin Works v. Collector - 1986 (25) E.L.T. 798 (Tri.); and (ii) Ram Steel Rolling and Forging Mills v. Commissioner - 2006 (204) E.L.T. 87 (Tri.-Mumbai). In the former case, one of the reasons stated by the Tribunal's Special Bench for holding the demand of duty to be unsustainable, was that the demand had been raised on the basis of audit objections and without investigations. In the latter case also, it was found that the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3,22,525/- lay on the assessee. The indisputable fact is that, in this case, the assessee consistently denied having taken any such credit. The department, in the absence of Cenvat Account, did not make out a fool-proof case of such credit having actually been taken by the assessee, either. The case of the assessee, as putforward by their Counsel today, is that, had a quantity of 13,724 kg of aluminium ingots been issued to the floor of the factory in 05-06 as alleged in the show-cause notice, it would have resulted in the production of a corresponding quantity of final product and, had any credit been taken on the said quantity ingots, the same would have been utilized for payment of duty on the finished goods. In any case, it is premature ..... X X X X Extracts X X X X X X X X Extracts X X X X
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