The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the charge of clandestine removal of goods computed on mere differences of the audit report and the production and clearance in central excise statutory returns in form Excise Return (ER-1) was not sustainable.
Micky Metals Limited, the appellant assessee had shown production of steel and steel rolled production Whereas, from the daily stock account maintained under Rule 10 of central excise rules, 2002.
The assessee appealed against the demand of duty was confirmed alleging clandestine removal of goods and suppression by the adjudicating authorities.
N.K.Chowdhury, the counsel for the assessee contended that as per the show cause notice demand has been confirmed due to some variation in the figures shown in the audit report and ER-1 filed by the appellant before the department without any evidence to show that the appellant has cleared clandestinely manufactured goods.
It was further submitted that the extended period of limitation was not invocable as show cause notice by invoking the extended period of limitation.
S.Mukhopadhyay, the counsel for the revenue relied on the decisions made by the lower authorities and contended that the assessee had suppressed the fact from the central excise department by not mentioning the production and clearance in central excise statutory returns in the form of ER-1.
The bench observed that merely based on the difference in the figures of the audit report and ER-1 return without establishing the parameters of clandestine manufacture and removal of goods, the charge of clandestine removal is not sustainable.
The two-member bench comprising Ashok Jindal (Judicial) and K. Anpazhakan (Technical) held that in the absence of any statement or investigation against the appellant with corroborative evidence, the impugned order was not sustainable and quashed the order while allowing the appeal filed by the assessee.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
