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M/s Mahendra Sponge And Power Ltd Versus Commissioner of Central Excise And Service Tax, Raipur

2015 (6) TMI 656 - CESTAT NEW DELHI

Duty demand - Insurance claim - Held that:- In their remand proceedings there were directions to Revenue also to tell the appellant under which provision revenue is seeking the demand of duty from the appellant on insurance claim on damaged goods. Neither both the authorities below nor the Ld. AR is able to tell under which provision duty is payable before the appellant on insurance claim received for damaged goods. In these circumstances, relying on the case laws cited by the Ld. Counsel for th .....

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om the appellant in insurance claim. 2. The facts of the case are that appellant is manufacturer of sponge iron. On 15.09.2005 heavy rain occurred in their factory and due to heavy rains finished goods got damaged. Appellant filed the claim before the insurance company for damaged goods and received the compensation. The appellant cleared these damaged goods on payment of appropriate duty. Revenue is of the view that as the appellant has received compensation for damages on the goods from insura .....

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red to send this case back to the Ld. Adjudicating Authority to examine RG-1 record and find out whether the stock was existing before the loss by rain and exist after the loss. In the process if the goods had been cleared, levy of excisable duty thereon cannot be ignored. But it is made clear that without bringing out to the knowledge of the assessee about the appropriate provision of law for taxability of insurance claim under the Excise Law, the compensation cannot be dutiable. The authoritie .....

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E. The production of sponge iron on 15.09.2005 was 129.00 MTs whereas the clearance of sponge iron was 15.0790 on 15.09.2005. The clearance of 150.790 was made under invoice as per Rule 11 of the Central Excise Rules, 2002 on payment of appropriated duty. Further 109.605 Mts of damaged sponge iron was cleared under Invoice No.1254 dated 16.09.2005, 1266 dt. 17.09.2005 and 1269 dated 18.09.2005 and these quantity were also shown in the clearance during the month of September 2005. All these three .....

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ntention he relied on the decision of this Tribunal in the case of Ratnatraya Heat Exchangers Ltd. Vs. CCE Mumbai-2011 (269) ELT 419 (Tri-Mum) , in the case of Jai Bhavani SSK Ltd. Vs. CCE Aurangabad-2008 (222) ELT 370 (Tri-Del) to say that amount received as insurance claim cannot be called as transaction value of the goods, damaged goods or goods lost. 6. On the other hand Ld. AR relied on the impugned order's para 5.3 which is reproduced here as under: "In the instant case the appell .....

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e No. 1254, 1266 & 1269 dated 16.05.2005,17.09.2005 & 18.09.2005 respectively is not tenable because the goods cleared under these invoices were also @Rs.9000/- which shows the rate of prime grade material." Thus without any tangible evidences in support of their claim their contention is not sustainable. Further, in the defence submission it is found that the Appellant had pleaded that they have not cleared the damaged stock of Sponge Iron from the stock it was shown in the RG-1 st .....

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