The honourable mumbai bench of the CESTAT , in the case of Savita Oil Technologies Ltd Vs. Commissioner of Central Excise {EXCISE APPEAL NO: 1117 OF 2012} has deleted the penalty imposed upon the appellant upon the fact that the appellant has reversed the credit after receiving the insurance claim . The some relevant observations of the tribunal are :
“It was submitted on behalf of the appellant that any compensatory restitution received upon settlement of insurance claim is adjusted by payment of duty to such extent and that has not been controverted by Revenue. This is the sole situation that the decisions relied upon envisage for fastening liability in recovery proceedings.
The decision in Petronet LNG Ltd makes it abundantly clear that such loss in transit is not includible for computation of ‘assessable value’; conversely, inclusion therein implies higher value per unit and consequent absorption of higher liability of tax.
Considering the circumstances supra and, in particular, the appellate orders in their own cases of identical recovery for other periods, the liability confirmed by original authority, and upheld in the impugned order, is without authority of law.”
The judgement can be accessed at :
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