9911796707
TMI Blog2018 (8) TMI 1875X X X X Extracts X X X X X X X X Extracts X X X X ..... been filed by the appellant-revenue under Section 35G of the Central Excise Act, 1944 (in short, "the Act") against the order dated 23-12-2014, Annexure A.3 passed by the Customs, Excise and Service Tax Appellate Tribunal, New Delhi (in short, "the Tribunal") in Excise Appeal No. E/4381/2004 [2015 (323) E.L.T. 600 (Tri. - Del.)], claiming following substantial questions of law :- (i) Whether the Hon'ble CESTAT is correct in setting aside the demand of Rs. 91,57,546/- along with interest and penalty by relying on judgment of the Hon'ble Supreme Court in the case of M/s. Oudh Sugar Mills v. Union of India reported in 1978 (2) E.L.T. J172 (S.C.) wherein the Apex Court has held that the allegation of duty e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xcise Department. It was availing Modvat Credit on Aluminum Wire Rod in terms of the Central Excise Rules, 1944 (in short, "the Rules"). Acting on the intelligence that they were showing excess consumption of principal raw material i.e. aluminum wire and were diverting the inputs clandestinely from the factory, on 25-11-1999, the officers of the Central Excise (Anti Evasion), Delhi IV, Faridabad visited the factory premises, scrutinized the excise records maintained by the assessee. In physical verification of finished goods, the quantity of finished goods was found to be tallied with the recorded balance in the RG-1 register but quantity of raw material was found short. Thereafter, statements of Alok Sharma, Managing Director, K.J. Josepth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther invoice book. Scrap detailed in executive pad of K.J. Joseph and aluminum wire rod as shown had been removed without payment of Central Excise duty. He accepted the shortage of 6170 Kgs. of raw material i.e. aluminum wire rod and accepted the duty liability arising therefrom. Alok Sharma in his statements dated 12-1-2000 and 14-3-2000 admitted the clandestine removal of inputs on which the assessee had availed Modvat credit. From the investigation, it was noticed that the assessee had cleared 839.271 MT of Aluminum Wire Rod valued at Rs. 6,49,75,466/- involving excise duty of Rs. 98,28,564/- during the period from 1-4-1995 to 25-11-1999 without payment of Central Excise duty equivalent to the Modvat credit availed and witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Km.) of various types of aluminum alloys standard conductors given in the ISI standard and the consumption of aluminum wire rod as recorded by the assessee company in its Central Excise records. For estimating the actual consumption of the aluminum wire rods, the departmental officers have calculated the weight of the aluminum conductors manufactured by the assessee during each financial year based on the approximate mass in per Kms. given in the Table 2 of ISI standard IS 398/1994 for the conductors of various diameters. It has been further recorded that mass in terms of Kg. per Km. given in Table 2 of ISI standard IS 394/1994 is only approximate mass and is not a figure which is 100% correct. It was held that the approximate mass in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s :- "The order which is disputed on the part of impugned order confirming Modvat credit demand of Rs. 91,57,546/- along with interest thereon under Section 11AB on alleged removal of 782.436 MT of Modvat credit availed aluminum wire rods during the period 1-4-1995 to 24-11-1999 and imposition of penalty of equal amount on the appellant. This Modvat credit demand is based on the difference between the consumption of aluminum wire rods calculated by the departmental officers based on the approximate mass per Km. of various types of aluminum alloys standard conductors given in the ISI standard and the consumption of aluminum wire rod as recorded by the appellant company in their Central excise records. For estimating the actual consum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring 1995-96 the actual consumption of the wire rod - 1395.825 MTs was more than maximum consumption of 1370.583 MTs. but in the subsequent years 1996-97, 1997-98, 1998-99 and 1999-2000, the consumption of the aluminum wire rod as per the appellant's record was much less than the maximum possible consumption during the period of dispute is seen, the consumption as per the appellant's records would be less than the maximum possible consumption as per the ISI standard. Therefore, merely on the basis of the approximate weight of wire in terms of Kg. per Km. for different types of aluminum conductors given in the ISI standard, the allegation of clandestine removal of Modvat credit availed aluminum wire rods cannot be made. We are supported in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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