Commissioner Of Central Excise And … vs M/S Aarti Steels Pvt Ltd, Focal Point. … on 22 February, 2024

Take notes as you read a judgment using our Virtual Legal Assistant and get email alerts whenever a new judgment matches your query (Query Alert Service). Try out our Premium Member services — Free for one month.

Punjab-Haryana High Court

Commissioner Of Central Excise And … vs M/S Aarti Steels Pvt Ltd, Focal Point. … on 22 February, 2024

Bench: Sanjeev Prakash Sharma, Vikas Suri

                                                       Neutral Citation No:=2024:PHHC:024887-DB




CEA-21-2022 (O&M)                                                     2024:PHHC:024887-DB
                                      Page 1 of 4


109

       IN THE HIGH COURT OF PUNJAB AND HARYANA AT
                      CHANDIGARH


                                                          CEA-21-2022 (O&M)
                                                    Date of Decision: 22.02.2024

Commissioner of Central Excise and Service Tax, Ludhiana
                                                                      . . . . Appellant
                                          Vs.

M/s Aarti Steels Ltd., Ludhiana
                                                                   . . . . Respondent

                       ****
CORAM: HON'BLE MR. JUSTICE SANJEEV PRAKASH SHARMA
       HON'BLE MR. JUSTICE VIKAS SURI
                       ****
Present:    Mr. Sourabh Goel, Sr. Standing Counsel with
            Ms. Geetika Sharma, Advocate
            Mr. Tej Bahadur, Advocate
            for the appellant.

                       ****
SANJEEV PRAKASH SHARMA, J.(Oral)

1. The appellant has preferred this appeal raising following questions as

substantial questions of law:

“A) Whether CESTAT has erred in not appreciating the
suppression of production arisen on calculating annual
electricity consumption which shows that there was excess
production of excisable goods as compared to the productions
reflected in their statutory records.

B) Whether electricity consumption can be considered as
valid evidence to ascertain the clandestine manufacture of the
taxable goods?

C) Whether it is correct in ignore facts decoded by the
authorised signatory persons of the Respondent when their
Director and the Managing Director themselves had mentioned
that they are not well versed that day to day working of the
factory and accordingly they authorized two other functionaries
to depose on their behalf?

1 of 4
::: Downloaded on – 23-02-2024 04:52:36 :::
Neutral Citation No:=2024:PHHC:024887-DB

CEA-21-2022 (O&M) 2024:PHHC:024887-DB
Page 2 of 4

D) Whether positive evidence in the form of voluntary
admitted statements supported by corroborative evidences in the
form of private records has substantiated the facts that the party
have been engaged in less recording of their production?

E) Whether the impugned order passed by the Ld.
CESTAT in dismissing the appeal filed by the appellant-
department is perverse, illegal and unjust?”

2. This Court finds that the Commissioner had examined all the aforesaid

issues and found on facts the claim and demand raised by the Revenue

to be without basis. The discretion for reaching to those conclusions

have been quoted in the order passed by the Customs, Excise and

Service Tax Appellate Tribunal (CESTAT), and the CESTAT has

confirmed the findings of fact arrived at by the Commissioner in the

following terms:

“4.4.2 We do not find any reason to differ with the
findings and conclusions drawn by the commissioner especially
after noting the fact that show cause notice itself acknowledges
that there is huge variation in consumption of power per MT of
Ingots produced on day to day basis. Revenue has in its appeal
not controverted the above finding of facts with any concrete
evidence. Hence the issue at two also needs to be decided
upholding the findings recorded by the Commissioner in
impugned order.

4.5.2 Commissioner is correct in his conclusion that the
goods were entered in the production records maintained by the
respondents only after quality inspection and clearance. During
the period of demand it was for the respondent assessee to
determine at which stage the he enters the finished goods in his
production records unlike the earlier period when an RG-1
stage was prescribed by the department. There seem to be no
error in the approach adopted by the respondent in entering the
goods in the production records only after the completion of
quality control checks. Undisputedly though production was
happening on the national/ public holidays, the goods could not
have been entered in the production records awaiting the quality

2 of 4
::: Downloaded on – 23-02-2024 04:52:36 :::
Neutral Citation No:=2024:PHHC:024887-DB

CEA-21-2022 (O&M) 2024:PHHC:024887-DB
Page 3 of 4

inspection which would happen on subsequent days. Thus the
issue of non recording of production on national/ public
holidays is reasonably explained by the respondents and
Commissioner found himself in agreement with such
explanation. We also do not find anything wrong in it. Hence
this issue is also answered in favour of respondents.

4.6.2 Commissioner has in above quoted para carefully
analyzed and compared the production data in the statutory
returns/ records and the private records of the respondents.
After comparing all the records and returns he finds that
production declared by the respondents in the ER- 1 returns is
higher than the production recorded in the private records.
Nothing has been put forth in the appeal by the revenue that
above findings an discussions are incorrect in any way. ER-
return is the statutory return prescribed under Central Excise
Law. If the total production declared in ER-1 return is higher
than that computed production on the basis of private records
we do not find any merits in submission made by the revenue,
that production in RG-1 register do not tally with private
records. Hence the issue on this account is answered in favour
of the respondents.

4.7.2 We do not find any reason to differ with the
findings recorded by the Commissioner. It may also be pointed
out that admissibility of CENVAT Credit is linked to the fact of
receipt of duty paid inputs within the manufactory under the
cover of duty paying document (viz invoice). In the present case
the demand for denial of Cenvat Credit is sought to be made on
the basis of consumption, which is contrary to the scheme of
Cenvat Credit Rules. Once there is no dispute about the actual
receipt of duty paid inputs under the cover of duty paying
documents, the Cenvat Credit cannot be denied subsequently by
referring to consumption of the same. Hence we do not find any
merits in the submissions made in revenue appeal on this
account.”

3. Thus, all the questions which the appellant has raised in the present

appeal, are essentially questions of fact and there is no question of law

as such which is required to be adjudicated by this Court.

3 of 4
::: Downloaded on – 23-02-2024 04:52:36 :::
Neutral Citation No:=2024:PHHC:024887-DB

CEA-21-2022 (O&M) 2024:PHHC:024887-DB
Page 4 of 4

4. Taking into consideration the concurrent findings of fact, we need not

entertain this appeal.

5. Accordingly, the appeal stands dismissed.

6. All pending applications also stand disposed of.

(SANJEEV PRAKASH SHARMA)
JUDGE

(VIKAS SURI)
JUDGE
February 22, 2024
Mohit goyal

1. Whether speaking/reasoned? Yes/No

2. Whether reportable? Yes/No

Neutral Citation No:=2024:PHHC:024887-DB

4 of 4
::: Downloaded on – 23-02-2024 04:52:36 :::

[ad_2]

Add a Comment

Your email address will not be published. Required fields are marked *