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TMI Blog2024 (6) TMI 757X X X X Extracts X X X X X X X X Extracts X X X X ..... , it has observed that There is nothing on record from the Revenue side to come to a reasonable conclusion to say that there has been preponderance of probability of such suppressed production on the part of the appellant. Since the impugned order itself is set aside on merits, there is no question of imposing personal penalty on Sri M. Jayaram, Director; hence, Revenue s appeal is dismissed. Appeal disposed off. X X X X Extracts X X X X X X X X Extracts X X X X ..... ce was issued on 04.08.2010 demanding duty alleging clandestine production and removal of the goods on the basis of SION norms. He has submitted that the Department has worked out the production of zinc oxide purely on theoretical basis and consequently, alleged that the excess quantity of zinc oxide has not been accounted for in their production register and removed without payment of duty. He submits that while applying SION norms, it is considered that zinc ingots with purity of 99.5%, which cannot be made applicable to variety of zinc scrap of different purities used by the appellant in the manufacture of zinc oxide. He has submitted that the said theoretical basis cannot be made applicable to remelted zinc ingots which is having less purity. In these circumstances, the total quantity calculated on the basis of the fixed parameter and on theoretical basis is erroneous and the excess quantity so determined in contrast to the quantity accounted in the production register and the excess quantity alleged to have been removed, cannot be sustained. He submits that other than the data relating to zinc scrap, literally there is no other evidence by the department to substantiate the al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alore held that theoretical basis cannot be adopted in demanding duty without corroborative evidences of clandestine manufacture and removal of goods. 2.6 He has further submitted that the demand raised for the period 2005-2006 to 2009-2010 is barred by limitation as all the facts have been disclosed by filing the returns from time-to-time. In support, they have referred to the judgment of Hon'ble Supreme Court in the case of M/s. Chemphar Drugs ad Liniments: 1989 (40) ELT 276 (SC). 3. Learned Authorized Representative reiterated the findings of the learned Commissioner/ Commissioner (A). 4. Heard both sides and perused the records. The issue for determination is whether SION norms be applied in determining the quantity of zinc oxide manufactured from zinc scrap and the difference in the calculated figure and the figure of production recorded in the statutory records be considered as clearance of zinc oxide clandestinely without payment of duty. 5. Undisputedly the appellants are using raw materials viz., zinc dross, skimming, zinc ingots and other zinc scraps for manufacture of zinc oxide. The department applying the SION norms has calculated the quantum of zinc oxide ought to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll.) and Supreme Court's decision in the case of Oudh Sugar Mills Ltd. v. Union of India - 1978 (2) E.L.T. (J172) (S.C.) and CESTAT's in the case of Punalur Paper Mills Ltd. v. CCE - Vide Final Order Nos. 996-997/2008, dated 26-8-2008 [2009 (244) E.L.T. 204 (Tribunal)]. The Hon'ble High Court in the case of Continental Cement Company (supra) has inter alia observed as under : 13. .......to prove the allegation of clandestine sale, further corroborative evidence is also required. For this purpose no investigation was conducted by the Department....... 14. ……. 15. ........When there is no extra consumption of electricity, purchase of raw materials and transportation payment, then manufacturing of extra goods is not possible…" The said judgment has been carried out in appeal before the Hon'ble Rajasthan High Court. Their Lordships after analyzing the whole issue including its report and principle of law on the issue upheld the order of the Tribunal. This Tribunal also in the case of M/s. Saravana Alloy Steel Pvt. Ltd. (supra) taking note of the principle laid down in various judgments held that demand based on theoretical consumption of electricity in dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f raw materials without accountal. No evidence is available for transport of such goods cleared without payment of duty. There is no evidence of receipt of sale proceeds of any quantity of its final products without accountal. These would indicate that the basis for finding of evasion viz., the power consumption ascertained by Shri G.S. Hegde is totally incorrect. If the position was otherwise, it would not have been difficult for the revenue to seize any such final products clandestinely cleared or to gather evidence of such clearances in the form of invoices for purchase of scrap or sale of finished goods or transport documents. The compelling conclusion would be that the impugned demands have no reliable basis and are liable to be set aside." Similarly, this Tribunal in R.A. Castings Pvt. Ltd. case (supra), more or less on similar circumstances, has observed as follows:- "19. The main question to be decided in the instant appeals here is whether the appellants during the period December 2001 to March, 2005 have actually manufactured M.S. Ingots in excess of what has been recorded in their statutory records and removed the said quantity clandestinely from their factory withou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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