TMI Blog2017 (5) TMI 1342X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by appellant on value of ₹ 4/- per kg. In consequence, there will also be no penalty in respect of the duty liability discharged by this manner. Coming to the duty liability on burning/transportation loss, irrecovable scrap, we find that the learned counsel has conceded the same. However, he prays for cum-duty benefit - Held that: - while maintaining the notional value of the quantum involved on such process loss etc. at ₹ 4/- per kg., the appellants are extended cum-duty benefit for purposes of calculating their duty liability thereon - the matter is remanded back to the adjudicating authority for revised calculation of duty liability. Penalty - Held that: - it is not in dispute that the appellants have paid the entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,088.370 Kgs. Thus duty was not paid on 36.75%, i.e., more than one-third of the scrap generated, involving duty amount of ₹ 23,43,799/-. A show cause notice dated 2.5.2005 was issued to the appellants proposing recovery of the said differential duty amount along with interest thereon and imposition of penalties under various provisions of the Central Excise Act. In adjudication, the Commissioner vide impugned order dated 4.10.2006 confirmed the proposals, however, redetermined the duty liability to ₹ 21,73,538/- (on account of duty for February 2003 having been demanded twice), along with interest thereon and imposition of equal penalty under section 11AC of the Central Excise Act, 1944 r/w Rule 25 of Central Excise Rules, 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kg, at the end of every month. 5.2 However, such discharge of duty liability was only with respect to the quantum of scrap physically available and retained by the job worker, duty liability on irrecoverable scrap or processed loss was not taken into account for discharge by the appellant. As per the investigations of the department, excise duty was not so paid on 25,25,264.110 Kgs. of scrap which accounts for 36.75% of the total scrap generated at the premises of the job workers. Appellants in their adjudication proceedings have contended that 20% of the said quantity arrived at by the department will have to be adjusted to be irrecoverable scrap. 5.3 Department however wants the appellant to adopt higher assessable value for the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liability thereon has been collected by the appellant. Hence, while maintaining the notional value of the quantum involved on such process loss etc. at ₹ 4/- per kg., the appellants are extended cum-duty benefit for purposes of calculating their duty liability thereon. So ordered. 6. For this limited purpose, the matter is remanded back to the adjudicating authority for revised calculation of duty liability. 7. Coming to the penalty aspect, it is not in dispute that the appellants have paid the entire duty liability at the rate of ₹ 4/- per kg even before issue of show cause notice, hence, in our considered opinion, the beneficiary provisions of Section 11AC can be applied and the appellants will have to pay penalty equal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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