TMI Blog2021 (8) TMI 708X X X X Extracts X X X X X X X X Extracts X X X X ..... es in the reconciliation provided by the Appellant between 3CD and ER 6 clearly account for the wastage during the manufacturing process which ranges from 0.40% to 1.60% percentage in different years and the same is within the normal industry average of two percent as per the Appellant s submission - the lower authority has not at all taken into account the plea of the Appellant as regards wastage of the preform during the manufacturing process whereas the same has been clearly established by the Appellant in its reconciliation provided at all occasions. Hence the order of the adjudicating authority deserves to be set aside as the same is based on assumption and without any cogent evidence for 100% conversion of preform in to PET bottles. The considered view that the Appellant has been able to produce the relevant reconciliations to show that there is no difference in consumption figures as per ER 6 and form 3CD of pre form and the only difference is on account of wastage which has not been considered by the lower authority. Also, for considering 100% conversion of preform into PET bottles, the Ld. Adjudicating authority has not given any basis for the same and has ignored the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered that all such preforms taken into use as shown in ER 6 returns were converted into PET bottles and thus the Appellant had manufactured pet bottles in excess of what is shown in ER 1 returns and hence it was stated that the appellant has clandestinely removed such goods without payment of excise duty. Based on the above, on July 27, 2018, the Commissioner of CGST CX, Audit II Commissionerate (hereinafter referred to as the Commissioner) issued a Show Cause cum Demand Notice to the Appellant proposing to demand excise duty on the differential quantity of preform consumption as per ER 6 and form 3CD by considering 100% conversion of preform to PET bottles. The appellant vide reply dated April 25, 2019 duly complied to the said show cause cum demand notice pointing out inter alia that there is no difference in consumption figures as per ER 6 and 3CD for preform and that the department has erred in considering 100% conversion of preform to PET bottles without giving any cognizance to the wastage of the preform as well as PET bottles during the production cycle. The Appellant further contended that demand is based only on the comparison of the figures reported in the annex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . COMMISSIONER OF CENTRAL EXCISE, AURANGABAD Versus COSMOS FILMS LTD. 2013 (292) E.L.T. 116 (Tri. - Mumbai) 3.2 The learned Advocate has also produced reconciliation copies to show the actual wastage of preform and PET bottles during various stage of manufacturing depicted by the flowchart and thus concluded that there is no difference in figures of consumption of pre form between 3CD and ER 6 for the period under dispute. 3.3. It is his submission that the demand is also barred by limitation as the demand covers the period from 2012-13 and 2014-15 to 2015-16 whereas the SCN was issued on July 27, 2018 much after the expiry of normal period of limitation. He further submits that the spot memo was issued in August 2014 whereas the SCN was issued in July 2018 and thus the question of invoking extended period of limitation does not arise as the department was fully aware of the facts of the case of the Appellant and hence, no penalty is imposable. 4. The learned Authorized Representative appearing on behalf of the respondent department, justified the order of the lower authority. 5. Heard both sides through video conferencing and perused the appeal records. 6. In the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of shortages shown in form 3 CD yearwise which are appearing in Question No. 8 of statement of J. Gupta dated 12-8-1997. Accordingly, total shortages reflected during 92-93 to 95-96 were 60 MT and particularly in the year 1995-96 they were shown as 11MT as against 67MT for the same year i.e. 1995-96 as were calculated and mentioned in Annexure B of the impugned show-cause notice dated 4-12-1997 issued by the Addl. Commissioner Central Excise Aurangabad. The variations in shortage have not been properly investigated by the Revenue. There is no evidence to substantiate that these raw materials had been cleared clandestinely. On the contrary there appears force in Appellants contention that there was processing loss during the manufacturing of final product. In any case the percentage loss of raw material consumption has been in the order of 0.415%, 0.223% and 1.057% in the year 1993-94, 1994-95 1995-96 respectively. The total percentage loss in the three financial years has been only 0.612% i.e. even less than 1% which is quite insignificant. It is also to be observed that the Appellants have been declaring such losses of raw material in the manufacturing process i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce. No evidence for extra production or unaccounted cash or statement of buyers or transporters has been obtained. It is a settled legal position that charge of clandestine clearance is a serious charge and the onus to prove the same is on the Revenue by adducing some evidence. The Tribunal has taken consistent view that in absence of corroborative evidence, the charge of clandestine clearance cannot be levelled against the assessee. Some of the decisions are as below : Ghodavat Pan Masala Products Ltd. v. CCE - 2004 (175) E.L.T. 182 (Tri.-Mumbai) CCE v. Supreme Fire Works Factory - 2004 (163) E.L.T. 510 (Tri.-Chennai) CCE v. Suvidha Limited - 2009 (236) E.L.T. 675 (Tri.-Del.) 9 .. In fact, in the instant case, no shortages of goods were ever found which fact is on record and not in dispute. In any case, since we have already noted hereinabove, that the whole basis of allegation of clandestine removal is the production pattern of other assessees, which has no legal or scientific basis, the impugned duty demand cannot be sustained. 10. In view of the above discussions, the impugned order cannot be sustained and accordingly the same is set asi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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