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TMI Blog2011 (2) TMI 839X X X X Extracts X X X X X X X X Extracts X X X X ..... in addition to M.S. Ingots, also manufacture Iron and Steel Castings and hubs for animal drawn vehicles. The M.S. Ingots are manufactured from scrap in induction furnace. In both the cases, the Department issued show cause notices to the appellants alleging suppression of production and clandestine removal of M.S. Ingots without payment of duty on the basis that they have under reported their production and clearances of M.S. Ingots, which is clear from the excessive power consumption for manufacture of per metric ton of Ingots 2400 unit in case of M/s Pragati Steel and 1700 units per M.T. in case of M/s Itah Steel, whereas according to the department, the average consumption should be around 1067 units per M.T. It is on this basis, that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the machinery of one appellant cannot be compared with the machinery of other manufacturers, that other than the average power consumption per M.T., there is no other evidence collected by the department indicating that the appellants had under reported their production and clearances of M.S. Ingots, that on similar basis, cases of duty evasion had been booked by the department against R.A. Castings Pvt. Ltd. in Meerut I Commissionerate and the Tribunal in this case, vide its judgment reported in 2009 (237) E.L.T. 674 (Tri. Del.) set aside the duty demand observing that the electricity consumption cannot be the only factor for determining the duty liability in the case of an induction furnace unit, especially when the Commissioner did not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case of M/s Pragati Steel and 1700 units per M.T. in the case of M/s Etah Steel is too high, that at this rate of power consumption, the manufacture of M.S. Ingots is not commercially viable and that in view of this, there is no infirmity in the impugned orders-in-appeal. 2.3 Shri Santhanam, in rejoinder pleaded that in case of U.P. Alloys Pvt. Ltd. vs. CCE, Kanpur (supra), cited by the learned DR, an experiment for determining the average power consumption per M.T. has been conducted but the department discarding that norm, had adopted the average power consumption of some other units and had raised the duty demand, which was not allowed, while in these cases, no such experiments had been conducted for determining the average pow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the machinery, power supply pattern and, the type of scrap used and for this, the only reliable method is to conduct actual experiment in the unit and ascertain the average power consumption per M.T. which has not been done in these cases. In view of this, I am of the view that adopting of power consumption norm of another unit is arbitrary and the confirmation of duty demand on this basis would not be sustainable. I find that same view has been taken in the case and the Tribunal judgment in the case of R.A. Castings Pvt. Ltd. vs. CCE, Meerut I (supra), which has been upheld by the Hon ble Allahabad High Court and the department s appeal has been dismissed by the Apex Court. In view of this, the impugned orders are not sustainable. The s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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