TMI Blog1989 (6) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... Stay applications 514/89 and 515/89 are required to deposit a sum of Rs. 1.00 lac and Rs. 2.00 lacs respectively, towards penalty. 2. Shri A. Satalvad, the learned Senior Counsel appearing on behalf of the applicants, contended that the applicants are re-rollers of iron and steel products. They were availing exemption under Notification No. 208/83. They were getting ship breaking scrap in the form of various steel materials like bars, flats, angles, etc. The Collector issued a show cause notice on 26-7-1988 on the ground that the exemption contemplated in the aforesaid notification is not admissible to them and there had been a deliberate suppression of material facts relating to input used and sought to confirm the demand for the period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able scrap and not a melt scrap. He also pointed out that the invoices in respect of all the scrap received have been gone through by the audit parties and also by various inspecting authorities. None has raised an objection to this input. As regards the period after 1-3-1986, the period involved is only one month and even here within a month they have specifically mentioned the description of input as per the new Tariff in the declaration filed for availment of MOD VAT Credit. He, therefore, contended that there was absolutely no intention to suppress any material facts justifying either extended period or imposition of penalty on the firm as well as on the manager and the partner. 3. He also contended that there had been a violation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng scrap. Failure on this account amounts to suppression of facts and hence the extended period is justifiable, so also the penalty imposed on the applicants. He also contended that the ship breaking scrap is not duty paid and hence the exemption is not available. He also submitted that the input namely ship breaking scrap has neither been specified in the Tariff nor in the Exemption Notification. It came to be specified only in the new Tariff effective from 1-3-1986 and ship breaking scrap was incorporated as the eligible input only by amending Notification No. 101/87 effective from 27-3-1987. In the absence of specific provision in the exemption notification, the input namely ship breaking scrap is not eligible for exemption. 6. After h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ip breaking scrap as well in the absence of separate classification for such ship breaking scrap prior to 1-3-1986. Moreover, invoices and other documents relating to receipt of inputs ought to have been gone through by audit parties, especially when the exemption is based on nature of inputs used. We are, prima facie satisfied that allegation of suppression of material facts cannot be sustained in regard to the period prior to 1-3-1986, when no separate classification for such ship breaking scrap existed. The Supreme Court have held that for suppression of facts, there should be something positive done other than mere inaction or failure on the part of the assessee. There should be a conscious and deliberate withholding of information Coll ..... X X X X Extracts X X X X X X X X Extracts X X X X
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