2002 (11) TMI 465 - AT - Central Excise

Summary

Issues:
Revenue appeal against order setting aside duty demand and penalty on alleged clandestine production and clearance of Iron and Steel Rerolled products, including penalties imposed under Rule 209A of the Central Excise Act, 1944.

Analysis:
The Revenue contended that the Commissioner (Appeals) did not adequately consider the evidence, including corroborative evidence like power consumption, in the case of alleged clandestine production. The Commissioner (Appeals) noted the varying electricity consumption per metric tonne and the inefficiency of the furnace in producing steel based on electricity input. The Revenue argued that the case should be reconsidered based on the Apex Court judgment in Triveni Rubber & Plastics v. CCE, emphasizing the significance of electricity consumption in confirming demands.

The Respondents, on the other hand, opposed the remand request, asserting that the Commissioner (Appeals) had correctly analyzed the evidence. They highlighted the lack of procurement of raw materials for excisable goods production and the absence of conclusive evidence supporting the allegations of clandestine removal. The Respondents stressed that power consumption alone cannot establish clandestine production without additional corroborative evidence.

Upon reviewing the records and submissions, the Judge observed discrepancies in electricity consumption data and acknowledged the importance of electricity consumption in determining clandestine removal, citing precedents. The Judge noted the unrebutted electricity consumption figures and evidence suggesting excess electricity usage. Consequently, the Judge set aside the previous order and remanded the case for further consideration, emphasizing the need for the Revenue to substantiate clandestine production claims with concrete evidence, including electricity consumption data.

The Judge also left open the question of penalty imposition on an individual involved in the case, directing the original authorities to reconsider this aspect. The decision allowed the parties to present legal arguments and evidence in the de novo proceedings, emphasizing the need for a detailed examination of the issues involved. The Judge instructed the original authority to promptly resolve the matter.