2009 (10) TMI 784

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... e confirmation of the demand and consequent penalties has arisen on the ground that the appellant had evaded duty by clandestinely removing the goods. The adjudicating authority has come to the conclusion that there was clandestine removal, on the basis of the consumption of power per MT of MS ingots based upon the records of the appellant for the earlier period and for the period in question. 3. Ld. Counsel submits that the period involved in this case is from May, 2002 to September, 2006 and the confirmation of demand has arisen only on the basis of power consumption. It is his submission that the yardstick applied by the ld. Commissioner is erroneous since the said figure represents only the power purchased from electricity boards and .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... be demanded. He would also submitted that the ld. Commissioner has earlier ordered for special audit under Section Rule 14A of the Central Excise Act, 1944 for the years 2001-02, 2002-03 and 2003-04 and it is seen from the said cost audit report that the total cost of the factory remains the same. 4. Ld. Jt. CDR on the other hand would submit that the appellant had not maintained any records as regards the incoming and outgoing material at the gate register. It is her submission that the unit of such a high sales turnover should not maintain the gate registers is a surprising. It is her submission that this itself indicate that there was an intention to remove the goods clandestinely. It is her further submission that the power consumptio .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... from this unit of the appellant/applicant is only 1/3 of the inputs which are consumed by the White Field unit. We find that if the demand has been worked out based upon the value of the goods cleared to the White Field unit, the value per MT of the goods which was cleared, worked out based upon the cost of production i.e. the total cost of production divided by total production during the relevant period. If that be so and if it is the contention of the Revenue that the confirmation of the duty is on the clandestine removal of goods, then such goods need to be accounted as the production and to be added to the total production of the unit. We find that if that is done, the cost of production per MT will be substantially less. If that be s .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X