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TMI Blog2016 (7) TMI 296X X X X Extracts X X X X X X X X Extracts X X X X ..... them is otherwise. Under the circumstances, we are inclined to take the view that this is nothing but deliberate withholding of information which will make this a fit case to invoke extended time limit under the proviso to section 11A of the Act for demand of duty. Alowance of Modvat Credit - the allowability will need to be evaluated with reference to the Modvat Rules prevailing in at the relevant time. - For this limited purpose, the matter is remanded to the Original Adjudicating Authority. Demand of duty with penalty confirmed - Decided in favor of revenue. - Excise Cross Application No. 166 and 167/2007 in Excise Appeal No. E/1160 and 1161/2007-EX [DB] - Final Order No. 52170-52171/2016 - Dated:- 23-6-2016 - MS. ARCHANA WADHWA, MEMBER (JUDICIAL) AND SHRI V. PADMANABHAN, MEMBER (TECHNICAL) Shri G.R. Singh, DR for the appellant Ms. Reena Khair, Advocate for the respondent. ORDER PER: V. PADMANABHAN This appeal filed by the Revenue is challenging the order dated 23/03/2006 passed by the Commissioner in which he dropped the demands made in the show cause notice dated 27/6/2002. This case is related to classification dispute i.e., whether the impu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... miner vide his report dated 19-20/9/2000 reported that the impugned sample was other than alloy steel. Accordingly, show cause notice was issued to the respondent for recovery of duty on ingots under Compounded Levy Scheme under Section3A of the Act and denial of other benefits which are not available to manufacturers working under section 3A of the Act. 5. Adjudicating Authority over-ruled the objections raised by the respondent to the test report and concluded that the same will be applicable w.e.f. 13/1/2000, i.e., the date of drawl of the sample and it will have no effect prior to that date. He further proceeded to quantified the liability to pay duty under section 3A on or after 31/1/2000. In terms of the formula for determination of annual capacity of the induction furnace, prescribed under the relevant rules, he fixed the duty liability as ₹ 2 lakhs per month and quantified the duty liability for the period 13/1/2000 to 31/3/2000 at ₹ 5,22,581/-. However, he dropped the entire demand of duty including the above made in the show cause by holding that the allegation of deliberate mis-statement or deliberate withholding of information with intend to evade the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ared their goods as alloy steel ingots. The Revenue authorities have never disputed this until the visit of the Central Excise Officers to the respondents factory on 13/1/2000 and sample of the product was drawn and tested by the chemical examiner. The chemical examiner in his report had given as follows:- The sample is in the form of metallic piece in rectangular form. It has the characteristic of steel containing less than 2% by weight of carbon. It is other than Alloy Steel. 10. During the cross-examination, the chemical examiner before the Adjudicating Authority has given the details of the individual constituents of the respondents sample. This has been analyzed by the adjudicating authority and concluded as below: Individual constituents of party s sample have been reported by the Joint Director (retired) CRCL New Delhi on 3.2.2003 as per which party no. 1 s sample contained Manganese -0.386%, Chromium-0.012%, Copper 0.064%, Nickel -0.018% and Carbon 0.209% only. The test for A1, B, Co, Pb, Mo, Si, Ti, W and V is reported to be negative. It is observed that the percentage content of elements as reported in the test report is less than the percentage content of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... legation is the report of the chemical examiner after testing the sample drawn on 13/1/2000. Hence, we are of the view that the demand prior to 13/1/2000 cannot be upheld. 14. The other serious challenge mounted by the Revenue against the impugned order is on the finding of the Original Authority that there is no deliberate mis-statement and hence, the extended period of 5 years cannot be invoked under Section 11A to fasten the demand. There is no dispute that the respondents have declared their product as those made out of alloy steel. They have consistently filed monthly returns during the period 1/4/1998 to 31/3/2000 declaring their product as alloy steel ingots and discharged the duty under the normal procedure. When we look at Section 3A of the Central Excise Act, as well as the scheme of payment of duty framed under the above section, we find that each manufacturer who is manufacturing products covered by the above scheme such as ingots and billets of non-alloy steel falling under Chapter 7206.90-7207.90 were required to file a declaration before the Jurisdictional Commissioner and get their production capacity determined in terms of the Rules prescribed under Section 3A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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