The Bangalore bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the excise duty demand on the clearance of TOR steel on the grounds of the absence of corroborative evidence.
M. J. Steel Re-Rolling Mill, the appellant assessee was engaged in the manufacture of TOR Steel i.e., MS Bars/Flats falling under Central Excise Tariff Act, 1985 and they had been availing Small Scale Industries (SSI) exemption under Notification No.8/2003-CE declaring that the total value of clearances was less than Rupees one crore.
The assessee appealed against the order passed by the Commissioner of Central Excise (Appeals-I) for confirming the excise duty demand along with the interest and penalty.
During the hearing of the appeal, none appeared on behalf of the assessee and H. Jayathirtha appeared on behalf of the department.
The counsel for the department contended that the assessee had failed to discharge duty of Rs.4,44,291/- even though they had exceeded the SSI exemption limit of Rupees one crore and the demand raised by the department was as per the law and liable to be sustained.
The Bench observed that the revenue had not collected the details of raw material suppliers nor any attempt was made to investigate raw material suppliers from either questioning the partner. Also, not an iota of evidence was placed on record indicating clearance of the manufactured goods clandestinely by bringing on record the evidence of Transporters or the purchasers of finished goods. The two-member bench comprising D M Misra (Judicial) and Pullela Nageshwara Rao (Technical) quashed the excise duty demand imposed on the assessee while allowing the appeal filed by the assessee.
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