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M/s Real Ispat And Power Ltd. Versus Commissioner of Central Excise And Customs, Raipur

2016 (4) TMI 327 - CESTAT NEW DELHI

Demand of duty alongwith interest - Disallowance of Cenvat credit for short received coal as the quantity was not found short in other consignments - Coal was sent to Coal Washery for processing of coal so that it can be used in the manufacturing process - Appellant contended that The loss of weight due to removal of ash content, mud, fines occurred due to such coal washing process has to be considered as arising during the course of manufacture of final product and credit has to be allowed. - .....

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at the certificate issued by the 'Central Institute of Mining & Fuel Research, Bilaspur Unit (Council of Scientific & Industrial Research), Bilaspur (Chhattisgarh) working under Ministry of Science & Technology, Govt. of India clarifies that there is positive correlation between percentage of Ash reduction & loss of coal volume i.e. yield of washed coal and that on 1 % of Ash reduction in Coal there is volume loss of approx. 2.5%. Also as per IEA Clean Coal Centre of International Energy Agency .....

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ion or suppression on the part of the appellant. Therefore, that the penalty imposed on the appellant is also not sustainable. - Decided in favour of appellant with consequential relief - Excise Appeal No. E/51572/2014-EX[SM] - Final Order No. A/50092/2016-SM(BR) - Dated:- 22-1-2016 - S. K. Mohanty, Member (J) For the Appellant : Shri Manish Saharan, Adv For the Respondent : Shri G R Singh, DR ORDER Per S. K. Mohanty The brief facts of the case are that the appellant is a manufacturer of Sponge .....

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ose. In the present case, during the course of verification of records by the Central Excise Audit wing, it was detected that in cases of 9 consignments, lesser quantity of coal have been received in the factory of the appellant, as compared to the invoiced quantity. The Revenue entertained the view that the short received coal was not used in the manufacture/ production by the Appellant, and hence, the appellant is not entitled for Cenvat credit for the short receipted quantity. Accordingly, Sh .....

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Hence, this present appeal before this Tribunal. 2. Shri Manish Saharan, the ld. Advocate appearing for the Appellant submitted that in respect of the disputed 9 nos. of consignments, the coal procured from mines were not capable for use as such in factory of the appellant for manufacturing activity, as the same contained foreign materials like mud, dust, ash, etc.; that the supplier of coal M/s South Eastern Coal Fields, a Govt. of India Undertaking, while issuing the delivery order, had speci .....

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on the decision of this Tribunal in case of M/s Tata Motors Vs. CCE, JSR, reported in 2011 (264) ELT 385 (Tri.) and CCE, Mumbai Vs. Bharat Radiators Ltd., reported in 2002 (148) ELT 1101. He also placed reliance on the delivery order of M/s South Eastern Coal field, which bears the name of the washery as well as bills issued by the washery, showing the quantity of coal delivered after washing. He also stated that since all the documents and records were produced before the audit wing of the Cent .....

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s much as possible (below 40% is better) to ensure reduction of the Iron ore. That most of the coal available in various collieries including Gevra & Dipka under South Eastern Coalfields Ltd., from whom the Appellant receives coal are of F grade having Ash content in tune of 46% & FC content in tune of 27%; therefore, such quality of coal cannot be used directly for the manufacturing of Sponge Iron and needs beneficiation & washing of coal to improve the FC content therein. That the .....

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r a bath, where the heavier Shale & Stone in Coal falls to the bottom while the lighter coal floats and then is removed for drying. During the said washing process the weight loss may occur from 15% to 25% of the quantity based on requirement of FC/Ash. That the reason of determination of 80% yield of washed coal against Raw coal of Gevra mines from which Appellant purchased coal of -250mm, and it was based on quality of Raw coal available in the respective colliery, offer of the washery for .....

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cate, on 1 % of Ash reduction in Coal, there is volume loss of approx. 2.5% which has been reflected in the table given in such certificate. That based on such certificate, for 8% Ash reduction, 20% volume loss of coal (8x2.5) was determined & accepted by both the Appellant and their Washery unit (Job worker). He also placed reliance upon the article of IEA Clean Coal Centre, which is a collaborative project of member countries of International Energy Agency to provide information about and .....

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hand, Shri G.R. Singh, the Ld. D.R. appearing for the Revenue reiterated the findings recorded in the impugned order and further submitted that Cenvat credit has been rightly denied by the authorities, since the entire quantity of coal has not been received in the factory for use in, or in relation to manufacture of the Final product. 5. Heard the learned counsel for both sides and pursued the records. 6. I find that the demand pertains to the period April 2010 to January 2012. The SCN was issue .....

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- CHAKABURA for processing of coal. The said Coal washery after undertaking the process of benefication of coal had charged service tax thereon and cleared the same to Appellant. The facts of the case are thus not much in dispute. It is an accepted fact that the coal was sent to Coal Washery for processing of coal so that it can be used in the manufacturing process. The loss of weight due to removal of ash content, mud, fines occurred due to such coal washing process has to be considered as aris .....

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