ORDER
Gowri Shankar, Member (T)
1. These appeals one filed by Sunder Casting Pvt. Ltd. and the other by Commissioner of Central Excise, Pune are against a common order of the Commissioner of Central Excise, Pune.
2. Sunder Castings Pvt. Ltd. manufacture ingots of steel, and for this purpose received various inputs. It had declared in the declaration under Rule 57G as bars and rods. The department actually received the declaration is not for bars and rods as such but for end-cutting pieces which are converted into ingots. The bars and rods were cleared as such on payment of duty to the dealers. These dealers cut them into length required by their customers. The notice issued to them proposed to deny the credit of the duty taken on the ground that what was received was scrap, not prime material which had been cleared from the manufacturer’s premises. We note that credit was taken on the basis of gate passes issued by such manufacturers endorsed to Sunder Casting Pvt. Ltd on the basis of certificate issued by the jurisdictional Superintendent. Apart from this, the appellant referred to us subsidiary gate passes. In the order impugned in the appeal, the Collector has confirmed the demand for duty to the extent of the credit taken on gate passes issued to the manufacturer and imposed penalty on Sunder Casting Pvt. Ltd. He has, however, dropped the amount to the extent of subsidiary gate passes on the ground that they have been validly issued by the department officer.
3. Sunder Casting Pvt. Ltd is absent and unrepresented. We have heard T.D. Bodade for the Department.
4. In the appeal there is no serious challenge to the fact that what had received was scrap, not prime material. Paragraph 3 of the appeal indicates “While the gate passes described the inputs as beams, channels etc, the corresponding commercial invoices/challans etc, describe them as scrap or Pcs.” That being the case, the manufacturer was not entitled to the credit of the duty paid on prime material. On merits, therefore, we are unable to find the case for the appellant.
5. The notice invoked the extended period contained in proviso to sub-section (1) to Section 11A of the Act. It alleged suppression of the fact of receipt of the scrap. On this, appellant’s contention is that commercial invoices which described the goods as scrap were, in fact, submitted to the department along with RT.12 returns. Therefore, simple verification of the commercial invoices and gate passes could have been done by the department. Therefore, extended period of limitation will not be available to the department. When confronted with this argument, the Commissioner says that the fact that knowledge of the department cannot absolve the assessee from the charge of suppression. Such a proposition is manifestly unacceptable. The assessee cannot be accused of suppression of facts which are already known to the department. In that situation the extended period would not be available to the department. In the absence of sufficient evidence before us, we are compelled to remand the matter to the Commissioner for verification. For this purpose, we allow the appeal and remand the matter to the Commissioner for adjudication on this aspect in accordance with law.
6. We now come to the other aspect. The Commissioner’s finding assailed in the department’s appeal is that since the subsidiary certificates were issued by the Superintendent of Central Excise based on the duty paying documents, the assessee cannot be faulted for taking credit. The department’s appeal challenges this conclusion on the ground that the description of the goods in the subsidiary gate passes was not tallied with the description in the commercial invoice, that the subsidiary certificates were issued deliberately to enable the assessee to take credit. If that were so, we would have expected action initiated against that officer who issued the documents for aiding such credit to be taken. No such action has been taken against the concerned officer. The department cannot on one hand not accept whatever is wrongful action on the part of its officer but at the same time punish the assessee on the proceedings in accordance with law. The Commissioner in the order records that in many cases the description in the parent gate passes and subsidiary gate passes were the same. We, therefore, not able to accept the department’s appeal in this regard.
7. It is found that no action is taken by the Commissioner against Sanjiv Sham Sunder Choudhari, Director of the firm and other employees. There is only one appeal from the department against the assessee. We cannot entertain its contention relating to other persons in this regard.
8. Appeal E/1199 dismissed. Appeal 577 allowed in part.
(Dictated in Court)