INDIAN OIL CORPORATION LTD. Vs. COMMISSIONER OF C.EX., MUMBAI
LAWS(BOM)-2017-9-301
HIGH COURT OF BOMBAY
Decided on September 18,2017

INDIAN OIL CORPORATION LTD. Appellant
VERSUS
Commissioner Of C.Ex., Mumbai Respondents

JUDGEMENT

A.S. Oka, J. - (1.) Heard the learned counsel appearing for the appellant. By this appeal, the appellant has taken an exception to the order dated 12th May, 2015 passed by the Customs, Excise and Service Tax Appellate Tribunal (for short 'Appellate Tribunal'), Western Zonal Bench, Mumbai. With a view to appreciate the submissions canvassed across the bar, it will be necessary to make a brief reference to the facts of the case.
(2.) The dispute relates to the base oil which is being received by the appellant which in turn is being used in manufacturing of final product. The appellant has been availing of Cenvat credit on such base oil. A show cause notice was issued on 5th January, 2010 by which a demand of duty of Rs. 1,64,40,644/- was made in respect of short receipt of base oil during the period from December 2004 to March 2009. The extended period of limitation was also invoked. The appellant was informed that the interest and penalty will be imposed by exercising power under Section [11C] of Central Excise Act, 1944. In the show cause notice, allegation in short is that the appellant had availed of Cenvat credit on duty of full quantity of base oil as shown in the invoice/bill but the scrutiny of documents shows that in fact the appellant has received base oil of a shorter quantity.
(3.) In adjudication proceedings, the Commissioner dropped the demand for the extended period. However, he confirmed the demand for the period from December 2008 to March 2009. He confirmed the demand for the said period and interest. Penalty of Rs. 8,37,482/- was imposed. Being aggrieved by the said order of the adjudication Authority, an appeal was preferred by the appellant before the Appellate Tribunal. The Appellate Tribunal disposed of the appeal by permitting the appellant to compute duty after taking benefit 0.1% permissible limit on account of various losses and to pay differential amount and interest. The Tribunal by the impugned order proceeded to set aside the imposition of penalty.;


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