2001 (1) TMI 282 - AT - Central Excise

Summary

Issues:
1. Stay application filed by the appellant.
2. Central Excise duty on Molasses clearance.
3. Subsidy offered by the State Government.
4. Appeal E/3342/2000-A regarding Molasses prices.
5. Appeal E/3343/2000 regarding Molasses grade and price.

Stay Application:
The appellant filed a stay application praying for staying the recovery proceedings. The Learned Counsel representing the appellant suggested disposing of the appeals without passing an order on the stay application. The suggestion was agreed upon, and the appeals were heard and disposed of accordingly.

Central Excise Duty on Molasses Clearance:
The appellant, a sugar mill, cleared Molasses to distilleries, paying Central Excise duty on the amount realized. The Central Excise Officers contended that duty should be paid based on the price fixed by the State Government for subsidy payment. However, evidence revealed that despite the State Government's offer of subsidy, the sugar mills did not receive any subsidy and cleared Molasses at prices below the government's suggested amount. The duty was paid on the actual amount realized, and no evidence indicated non-payment of excise duty by the appellant.

Subsidy Offered by State Government:
Although the State Government offered a subsidy of Rs. 100 per quintal of Molasses, no record showed that the subsidy was paid to sugar mills. Sugar mills cleared Molasses at prices lower than the government's suggested rate, and no subsidy was received. The duty was paid on the actual realized amount, and there was no evidence of non-payment.

Appeal E/3342/2000-A - Molasses Prices:
This appeal related to Molasses prices during a specific period. The orders mentioned the prices at which Molasses was sold, and duty was paid on the realized prices. The contention that duty should be recovered based on the State Government's higher fixed value for Molasses was dismissed. As no subsidy was received from the government, the duty was paid on the actual realized amount, leading to the setting aside of the impugned orders.

Appeal E/3343/2000 - Molasses Grade and Price:
In this appeal, the appellant sold Molasses at a specific rate, claiming it was of 'C' Grade. The Department disputed this, asserting it was 'A' Grade with a higher price. However, no substantial evidence supported the Department's claim, and the Minutes from a meeting held by the Chief Minister were not legally binding. As there was no evidence to refute the Molasses grade claimed by the appellant or the price realized, the claim for differential duty was deemed unsustainable, resulting in the orders being set aside.

In conclusion, both appeals were allowed, and the impugned orders were set aside based on the lack of substantial evidence supporting the contentions made by the Central Excise Department regarding Molasses prices, grades, and duty payments.