TMI Blog2016 (9) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... cided in favour of appellant with consequential relief - E/819/2004 - A/30580/2016 - Dated:- 29-6-2016 - Ms. Sulekha Beevi, C.S., Member(Judicial) and Mr. Madhu Mohan Damodhar, Member(Technical) Shri Karan Talwar, Advocate for the Appellant Shri S.Reddy, AR for the Respondent ORDER The appellants are a small scale unit engaged in the manufacture of Plywood falling under Chapter 44 of the Central Excise Tariff Act, 1985 and commenced their commercial production operations in June 1998. The manufacture of core veneers was commenced during November, 2001 and face veneers in the year 2002. The raw materials required for the manufacture of plywood are face veneer, core veneer, chemicals like phenol, formalin and resin/glu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, Order-in-Original No.35/2002, dated 30-08-2002 was passed without granting an opportunity for personal hearing which was set aside by the Tribunal vide Final Order No. 134/2003, dated 28-01-2003 and the matter was remanded for fresh adjudication. In the de-novo adjudication, the Commissioner of Central Excise, Visakhapatnam passed Order-in-Original No.64/03-04(RP) denovo dated 31-03-2004 wherein duty of ₹ 12,68,173/-was confirmed besides imposing penalty and interest. The computation of demand by the Commissioner is as follows: - Demand of duty on plywood on the unaccounted Quantity of face veneer ₹ 3,89,760/- - Demand of duty unaccounted production after Discounting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to proceed on the above assumption. The appellants submit that there could be no mathematical precision in any industry as regards the input-out ratio. In many cases, the appellant shave used face veneers in the place of core veneers to achieve the required thickness. In view of the above factors, the department s assumption that a mathematically precise input-out of 2 sq.mt of face veneers to produce 1 sq.mts of plywood is impossible to achieve. The department has proceeded solely on the ground that 2 sq. mts of face veneer is required to manufacture 1 sq. mt of plywood. The fact that other raw materials like phenol, formalin, melanin etc. are also required for the manufacture of plywood has been totally lost sight of. That therefore, when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of face veneers. The department has not fixed any input output ratio for the consumption of face veneers and production of plywood there from. But by common logic, when 2 face veneers of 4 mm thickness are required for manufacture of plywood, this ratio can be logically taken for the accounting of the face veneers and the plywood produced out of them. The assessee, therefore, is required to explain the difference, if any, from this logical conclusion. On these circumstances, the demand is sustainable. 7. We have heard both sides. 8. At the outset it has to be stated that in the assessee's own case for different period on the show cause notice issued on very same allegation, the Tribunal vide Final Order No.21477/2015, dated 14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. plywood. As submitted by learned counsel, other than the statement of Shri P.K. Dash, no evidence has been gathered and no technical literature has been used and no sample has been drawn and tested. In these circumstances, we consider that the submission of learned counsel that the impugned order has no merit has to be accepted. Accordingly, the impugned order is set aside and the appeal is allowed with consequential relief if any to the appellant. 9. Following the decision laid in the assessee's own case, we are of the view that the demand is not sustainable. The impugned order is set aside. The appeal is allowed with consequential reliefs, if any. (Operative part of this order was pronounced in court on conclusion of the he ..... X X X X Extracts X X X X X X X X Extracts X X X X
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