9911796707
TMI Blog2015 (6) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... The appellant were claiming nil rate of duty as per exemption under Notification No. 04/2006 dated 01.03.2006. Show-cause notice was issued to appellant dated 20.12.2010 that, the 'mill scale powder' arising during the manufacturing process in the factory of the appellant, is not slag, and therefore assessee is not entitled for exemption as per Sr. No. 6 of Notification No. 04/2006 dated 01.03.2006 and are liable to pay Central Excise duty. Further as per the internal Audit EA-2000, pointed out and objected, the appellant is required to reverse amount @10% / 5% as applicable under Rule 6(3) of CENVAT Credit Rules, 2004 against clearances of 'mill scale powder' on ground of not maintaining separate account of inputs used in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly examination of the records before me. I find that the respondent has mentioned in the ER-1 returns about the clearance of the exempted goods, although the department has not verified the entry claiming exemption. It is the duty of the department to verify the exemption sought by the appellant to the extent why the exemption has been claimed and whether the credit has been reversed or not?, which the department has failed to do. It was well within the knowledge of the department that the goods have been cleared as exempted goods, the said fact has been confirmed by the Superintendent of Central Excise in his report to invoke extended period. Department was having the knowledge as it is clear that the respondent is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in manufacture of exempted goods. Accordingly prays for dismissing the appeal. 5. Heard both the parties. 6. Having considered the rival contentions. I find that the appellant have disclosed the clearance of 'mill scale powder/iron ash' clearly in ER-I returns and claimed exemption under Notification No. 04/2006 dated 01.03.2006. There is no suppression of fact established on part of the appellant. It is the duty of department to verify the exemption claimed by the appellant and to determine whether the credit has been reversed or not. In the circumstances, it is held extended period is not attracted. I allow the appeal in part and set aside the penalty under Section 11AC. Appellant will be entitled to the consequential reli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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