2016 (12) TMI 336 - AT - Central Excise

Demand - clandestine removal - Held that - The case of the Revenue is based only on the presumption that there is no production loss of inputs. Admittedly, fly ash which is input for manufacturing were cement is of such nature that it cannot be used 100% as input in manufacturing of the cement, therefore, the basic presumption of the Revenue is that there is no wastage or loss erroneous. Further, I find that no positive evidence has been produced on record by the Revenue to allege clandestinely excess manufactured cement and clearance of cement - the allegation of the clandestinely manufacture of goods and clearance of cement is not sustainable. Appeal allowed - decided in favor of appellant-assessee.

Summary

Issues: Appeal against duty demand for clandestinely removal of manufactured goods.

Analysis:
The appellant, engaged in manufacturing Ordinary Portland Cement, was accused of clandestinely clearing finished goods without paying duty. The Revenue alleged that no loss or wastage occurred during the manufacturing process, leading to the demand for duty. The appellant contended that fly ash, an input, cannot be used entirely in cement manufacturing, challenging the Revenue's claim of excess production and clearance without duty payment. The Revenue's case relied on the presumption of no production loss, but the tribunal found this erroneous as fly ash cannot be fully utilized in cement production. Moreover, no concrete evidence was presented by the Revenue to support the allegation of excess production and clearance without duty payment. Consequently, the tribunal ruled in favor of the appellant, setting aside the impugned order due to lack of merit. The appeal was allowed, granting consequential relief, if any.