2007 (3) TMI 645 - AT - Central Excise

Summary

Issues involved: Appeal by Revenue against Order-in-appeal allowing respondent's appeal regarding duty demand based on insurance claim.

Detailed Judgment:

Issue 1: Suppression of production during fire incident
The Revenue alleged that the respondent suppressed production of finished goods during a fire incident in their factory premises. The claim filed by the respondent with the insurance company was used to raise a demand by the Revenue. The learned advocate for the respondent argued that there was no suppression involved.

Issue 2: Time bar and limitation
The main issue revolved around the demand of duty calculated by the Revenue based on the insurance claim. The Commissioner (Appeals) found that the department was aware of the fire accident immediately on the next day, as evidenced by the actions taken by the authorities. The Commissioner also noted discrepancies in the adjudicating authority's reliance on a Surveyor's Report and the timing of the audit conducted by CERA party. The Commissioner concluded that the demand raised after about five years was hit by limitation and not sustainable under the law.

In conclusion, the Commissioner (Appeals) determined that there was no suppression or intention to evade payment of duty by the respondent. The order setting aside the liability on the respondent due to the time bar was upheld, and the appeal filed by the Revenue was dismissed.