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Jharkhand High Court · body

2017 DIGILAW 2000 (JHR)

Shree Om Metals Limited v. Union of India

2017-11-21

AMITAV K.GUPTA, D.N.PATEL

body2017
ORDER : D.N. Patel, J. This writ petition has been preferred by the petitioner challenging the show cause notice 05.11.2014 (Annexure 1), issued by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur as well as the Order-in-Original bearing No. 04/Joint commr/2016 passed by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur dated 18/19.02.2016 (Annexure 4), mainly on the ground that the show cause notice and Order-in-Original has been passed on presumption and surmises. Further the petitioner has also challenged the Order-in-Original dated 18/19.02.2016 before the Appellate Authority i.e. the Goods & Service Tax and Central Excise (Appeal) whereby the appeal filed by the petitioner has been dismissed confirming the demand raised by the Respondent No. 3 in Order-in-Original dated 18/09.02.2016. As per the petitioner, highest case of the department is that there is some possibilities of clandestine removal of M.S. Ingots, which is a final product of this petitioner. 2. Factual Matrix: This writ petitioner is manufacturing M.S. Ingots since long. Show cause notice dated 05.11.2014, was given by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur for the period running from October, 2013 to March, 2014. The petitioner appeared before Respondent No. 3 pursuant to the show cause notice and filed its reply on 24.10.2015. Thereafter, the Order-in-Original was passed by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur on 18/19.02.2016 (Annexure 4). Being aggrieved and dissatisfied by the Order-in-Original, the petitioner preferred statutory Appeal before the Appellate Authority, which was registered as Order-in-Appeal No. 100/JSR/2017 which was dismissed vide order dated 14.07.2017 (Annexure 5). Being aggrieved and dissatisfied by the Appellate Order, the present writ petition has been preferred. 3. Arguments canvassed by the counsel for the petitioner: Counsel appearing for the petitioner submitted that the whole show cause notice is issued upon presumptions and surmises about unaccounted manufacturing of M.S. Ingots and clandestine removal of the final product and nothing has been proved by the respondents. Only on the basis of presumptions, the show cause notice has been decided. The consumption of electricity pattern, which is referred in the show cause notice as well as in the Order-in-Original, is absolutely baseless. Only on the basis of presumptions, the show cause notice has been decided. The consumption of electricity pattern, which is referred in the show cause notice as well as in the Order-in-Original, is absolutely baseless. It is submitted by the counsel for the petitioner that looking to Annexure-G as referred in para 4 of the show cause notice, reveals the electricity consumption per M.T., which is absolutely in consonance with the report given by the Joint Plant Committee constituted by the Ministry of Steel, Government of India and as per this report, the consumption can be 1800 KWH/T (as referred in paragraph No. 20 of a decision 2009 (237) ELT 674 in the case of R.A. Casting (Private) Ltd. v. CCE). Thus, there is no scientific survey carried out by the respondents which can lead to conclusive evidence of unaccounted manufacturing of M.S. Ingots and clandestine removal thereof. It is further submitted by the counsel for the petitioner that Dr. N.K. Batra's report has been referred to every now and then, since 2003 onwards, by the respondents and there are no less than one dozen judgments in which it has been observed right from the learned Tribunal to the Hon'ble Supreme Court of India that electricity consumption per se cannot be relied upon by the respondents for proving clandestine removal of final product, because there is no set pattern for consumption of electricity. There are several reports given by more reliable institutions and persons than Dr. N.K. Batra, which have been referred in the aforesaid decisions of R.A. Castings. The respondents ought to have carried out experiment of consumption pattern of electricity at the factory premises of the noticee, which has been referred to in paragraph No. 22 of the decisions of R.A. Castings Private Ltd, which has not been gone into by the respondents. The whole show cause notice is based upon presumptions and surmises. The burden of proof lies upon the respondents that there is a clandestine removal of finished product, which has not been discharged, at all, by the respondents. It is also submitted by the counsel appearing for the petitioner that the respondents are surprised about the loss sustained by the petitioner. Merely because there is a loss to this petitioner, that does not mean that there is a clandestine removal. It is also submitted by the counsel appearing for the petitioner that the respondents are surprised about the loss sustained by the petitioner. Merely because there is a loss to this petitioner, that does not mean that there is a clandestine removal. Counsel appearing for the petitioner has relied upon the decisions which are as under:- (a) R.A. Castings decisions 237 ELT 674, which is confirmed by the Division Bench of Hon'ble Allahabad High Court 2010 (1) taxman.com. 342 (Allahabad), against which SLP preferred by the department, has also been dismissed. (b) W.P. No. 173 of 2014 decided on 22.04.2014 by the Hon'ble Calcutta High Court. Counsel appearing for the petitioner has pointed out that in several similarly situated cases, in which Dr. N.K. Batra's report has been referred to and relied upon, for proving clandestine removal of the finished products, in the show cause, ultimately in the Orders-in-Original, the show cause notices have been dropped by the adjudicating authority itself. The similarly situated cases are as under:- (a) Globe Steel & Alloys Pvt. Ltd, the Order-in-Original: 02/Central Excise/commr/2015 dated 31.03.2015, copy whereof has been given to the counsel for the respondents. (b) M/s. Madhura Ingots & Steel Co. Pvt. Ltd. Order-in-Original: 07/Central Excise/commr/2015 dated 19.05.2015. (c) M/s. Jagannath Cement Works Pvt. Ltd being Order-in-Original: 31/Denovo/Commr/2015 dated 15.12.2015. (d) M/s. Kamsa Steel Pvt. Ltd. being Order-in-Original: 33/commr/2015 dated 21.12.2015, and several other orders, copies of which have been given to this Court and given to the respondents. On the basis of aforesaid decisions, it is submitted by the counsel for the petitioner that electricity consumption pattern, is useless argument on behalf of the respondents. Every now and then, such argument has been canvassed in the Order-in-Original and the first adjudicating authority has dropped the baseless notice and whenever the first authority has confirmed such ground, the Tribunals have passed the Orders and quashed such ground, like in the case of R.A. Castings Pvt. Ltd v. CCE, which is approved by Hon'ble Allahabad High Court and SLP has been dismissed by the Hon'ble Supreme Court. It is further submitted that whenever Orders-in-Original are passed as stated hereinabove, dropping the show cause notice, the same are placed before the committee consisting of two Chief Commissioners and they are taking decisions, whether to prefer any further appeal or not and all aforesaid cases where the show cause notice has been dropped and the ground of the electricity consumption pattern has also not been approved, in the Order-in-Original, no appeal has been preferred by the department. Thus, it has become fashion with the respondent that arbitrarily in few cases, ground of Dr. N.K. Batra will be raised for few industries and for rest of the industries, no such ground is ever raised. Because of this N.K. Batra's report, several petitions have been filed and several decisions have to be given by the Courts. Counsel for the petitioner has submitted that even a circular has been issued, which is at Annexure 3 dated 26.06.2014 that whenever any decision has been finally accepted by the respondents department, the same has to be followed in other cases. This circular has also not been followed in this case. In fact, the respondents could not prove the clandestine removal of the finished products viz. M.S. Ingots and hence show-cause notice dated 05.11.2014 as well as Order-in-Original dated 18/19.02.2016 which are at Annexure 1 and Annexure 4 respectively, may kindly be quashed and set aside. 4. Arguments canvassed by the counsel for the respondents: Counsel for the respondents submitted that this petitioner is having efficacious and alternative remedy against the Order-in-Appeal and the appeal can be preferred before the Central Excise and Service Tax Appellant Tribunal (CESTAT) under Section 35(B) of the Central Excise Act, 1944. Counsel appearing for the respondents submitted that Dr. N.K. Batra's report is not an only ground as mentioned in the show-cause notices, there are several other grounds. In detail, consumption of electricity pattern has been mentioned in Annexure G. Similarly, other grounds have also been dealt with in detail, in the Order-in-Original and, hence, this Court may not entertain this writ petition. Reasons: 5. N.K. Batra's report is not an only ground as mentioned in the show-cause notices, there are several other grounds. In detail, consumption of electricity pattern has been mentioned in Annexure G. Similarly, other grounds have also been dealt with in detail, in the Order-in-Original and, hence, this Court may not entertain this writ petition. Reasons: 5. Having heard counsels for both the sides and looking to the facts and circumstances of the case, we, hereby, quash and set aside the Order-in-Original dated 18/19.02.2016 as well as the Order-in-Appeal dated 14.07.2017 (Annexure 4 and 5 to the memo of this writ petition respectively) mainly for the following facts and reasons: (i) Show-cause notice was given by the respondents on 05.11.2014 for the period running from October, 2013 to March, 2014 mainly on the ground that there is unrealistic electricity consumption. On this ground, the show-cause notice has been given by the Joint Commissioner, Central Excise and Service Tax, Jamshedpur. (ii) In the show-cause notice, Dr. N.K. Batra's report has been referred to and relied upon. Moreover, there is also reference of Nucleus Group report. (iii) Counsel appearing for the petitioner has relied upon several decisions, as stated herein above. It ought to be kept in mind by the respondents that the electricity consumption pattern can be a corroborative ground and not a substantive ground at all. Thousands of possibilities cannot be equated with one truth. The grounds, which are referred in the Order-in-Original, are in fact leading the respondents towards the highest probabilities and nothing beyond that to suspect that there is a clandestine removal of the finished product by the notice. Nonetheless, for exact proof of unaccounted manufacturing of finished products and for clandestine removal thereof, more labour was required to be done by the respondents. It has become fashion with the respondents department to rely upon a document, since 2003 onwards, which is known as report given by Dr. N.K. Batra, so called Professor of IIT, Kanpur. When IIT, Kanpur is inquired whether such report has ever been given by IIT, Kanpur, the answer was given by IIT, Kanpur in negative (Annexure 6, 6/1 to the memo of the petition). (iv) Right from 2003 onwards, in not a single matter decided by the Commissioner or by the Tribunal or by any adjudicating authority, the department has produced Dr. (iv) Right from 2003 onwards, in not a single matter decided by the Commissioner or by the Tribunal or by any adjudicating authority, the department has produced Dr. N.K. Batra for cross examination by any assessee in whole of India. Nobody knows the authenticity of Dr. N.K. Batra's report. Nobody is error proof authority much less Dr. N.K. Batra. Hence, his cross examination is must. His report is not a conclusive piece of evidence as per Indian Evidence Act, 1972. (v) Several decisions have been given by the Tribunals which have been confirmed by Hon'ble High Courts that electricity consumption alone if adopted as a basis of the demand, the same is not tenable. The respondents can take the electricity consumption pattern as a corroborative piece of evidence, but, in absence of substantive proofs like- (a) Details about the purchase of the raw material within the manufacturing units and no entries are made in the books of account or in the statutory records. (b) Manufacturing of finished product with the help of the aforesaid raw material, which is not mentioned in the statutory records. (c) Quantity of the manufacturing with reference to the capacity of production by the notice unit. (d) Quantity of the packing material used. (e) The total number of the employees employed and the payment made to them. (f) Ostensible discrepancy in the stock of raw materials and the finished product. (g) Clandestine removal of goods with reference to entry/exit of vehicles like Trucks etc. in the factory premises. (h) If there is any proof about the loading of the goods in the Truck, like weight of truck etc. at the weighbridge, security gate records, transporter documents such as lorry receipts, statements of the truck drivers, entries of the trucks/vehicles at different check-post. Different types of forms which are supplied by the Commercial Tax Department, like Road Permit supplied by the commercial tax department, receipts by the consignees etc. These documents ought to have been collected by the respondent-department, if at all, they are interested in collection of the correct central excise duty from the notice upon whom or upon which allegation of clandestine removal of the finished product is levelled. The electricity consumption report like Dr. N.K. Batra report can hardly be treated as a substantive evidence. Time and again, the decisions have been given by the Tribunals, but, the respondents departments are turning deaf-ear to. The electricity consumption report like Dr. N.K. Batra report can hardly be treated as a substantive evidence. Time and again, the decisions have been given by the Tribunals, but, the respondents departments are turning deaf-ear to. In this case, they are also turning deaf-ear to their own circular dated 26.06.2014 (Annexure 3 to the Memo of this writ). In this case, the respondents are relying upon Dr. N.K. Batra's report. All these are nothing, but, the possibilities, for clandestine removal, but, for proving the clandestine removal, the substantive piece of evidence is must. Few such evidences have been referred by this Court. The list of these evidences is not exhaustive: (i) The department should have collected the proof of amount received from the consignees, statement of consignees, receipts of sale proceeds by the consignor and its disposal. (vi) In the instant case, though the petitioner was granted an opportunity of being heard, but, while passing the Order-in-Original, the adjudicating authority has not dealt with the main contention advanced on behalf of the petitioner and no reasons have been assigned for differing with the decisions relied upon by the petitioner, particularly, the decision rendered in the case of R.A. Castings Ltd. In this context, reference may be made to the decision of the Hon'ble Supreme Court in the case of Assistant Commissioner, Commercial Tax Department, Works Contract Act and Leasing, Kota v. Shukla and Brothers, (2010) 4 SCC 785 . In the said decision, the Hon'ble Supreme Court, vide Para 14, has held as under:- "14. The principle of natural justice has twin ingredients: firstly, the person who is likely to be adversely affected by the action of the authorities should be given notice to show cause thereof and granted an opportunity of hearing and secondly, the orders so passed by the authorities should give reason for arriving at any conclusion showing proper application of mind. Violation of either of them could in the given facts and circumstances of the case, vitiate the order itself." Further, the Hon'ble High Court of Gujarat, in the case of Vadilal Gases Ltd. v. Union of India, (2015) 64 Taxmann.com 56 (Guj), in paras 10 and 11, has held as under: "10. At this juncture, reference may be made to the decision of the Supreme Court in the case of Asstt. At this juncture, reference may be made to the decision of the Supreme Court in the case of Asstt. Commissioner of Commercial Tax v. Shukla and Brothers, (2010) 4 SCC 785 on which reliance has been placed by the learned counsel for the petitioner wherein the court has held that the principles of natural justice has twin ingredients; firstly the person who is likely to be adversely affected by the action of the authorities should be given notice to show cause thereof and granted an opportunity of hearing.; and secondly, the orders so passed by the authorities should give reasons for arriving at any conclusion showing proper application of mind. Violation of either of them could in the given facts and circumstances of the case vitiate the order itself. 11. Examining the facts of the present case in the light of the above decision, while it cannot be said that the impugned orders are totally non-reasoned orders, at the same time, the main contention advanced on behalf of the petitioner has not been dealt with and no reasons have been assigned for not accepting the same. The impugned order does not show that the authority concerned has applied its mind to the contention raised by the petitioner. Therefore, as held by the Supreme Court in the above decision, the principles of natural justice would stand violated in the light of the fact that the concerned authority has not applied its mind to the principal contention raised by the petitioner, inasmuch as, it has not given any reason in respect thereof." In view of the aforesaid decisions, if there is a violation of principle of natural justice, writ is always tenable at law. (vii) Thus, the department has not done any home work and the show cause notice dated 05.11.2014 (Annexure-1) has been issued. This type of shortcut should not have been followed by the department. There is no shortcut for success. The aforesaid documents and evidences could have been collected very easily by the department, if at all, department is of the opinion that there is a clandestine removal of finished product viz M.S. Ingots by the petitioner. This type of shortcut should not have been followed by the department. There is no shortcut for success. The aforesaid documents and evidences could have been collected very easily by the department, if at all, department is of the opinion that there is a clandestine removal of finished product viz M.S. Ingots by the petitioner. (viii) The respondents have also been given time and again the guidance by various decisions that whenever they are relying upon the electricity consumption pattern, experiment in the very same unit ought to have been carried out for manufacturing of 1 MT of the finished product or for at least 1000 such unit, if any other product is involved, so that average consumption of electricity can be accurately measured by the respondent-department. Electricity consumption, which is based upon Dr. N.K. Batra's report, is absolutely useless, with reference to the units for which allegation is levelled for clandestine removal without carrying out any experiment of consumption of electricity in the very same unit. Hence, we, hereby direct the respondents, henceforth not to use Dr. N.K. Batra report against any noticee especially when the department is levelling allegations of clandestine removal of finished products, unless, the experiment of consumption of electricity is carried out at the factory premises of the very same assessee/noticee. The consumption of the electricity depends upon the efficiency of the machines also. It also depends upon the fact whether the noticee is utilizing obsolete machinery or modern machinery. Dr. N.K. Batra might have carried out experiment in a factory where there may be efficient machinery, whereas, machines used by the noticee may not have the same efficiency. Therefore, cross examination of Dr. N.K. Batra is must. Department can use the report of Dr. N.K. Batra as the guidelines and nothing beyond that. Department has to bring its own experts at the factory premises of the noticee. Department must carry out an experiment of the consumption of the electricity at the manufacturing place of the noticee either for 1 MT or for 1000 unit etc. so that, the electricity consumption pattern can be measured for the very same machinery and thereafter it can be compared with the quantity of the finished products mentioned, in the books of accounts, with the electricity bills of the noticee. so that, the electricity consumption pattern can be measured for the very same machinery and thereafter it can be compared with the quantity of the finished products mentioned, in the books of accounts, with the electricity bills of the noticee. This exercise is must before issuing the show cause notice by the respondent department, whenever the department is levelling allegation of clandestine removal on the basis of electricity consumption pattern. Instead of doing this exercise, straightway, Dr. N.K. Batra's report has been relied upon, which has no relevance with the factory premises of the noticee. Hence, such report shall not be relied upon by the respondents, unless the aforesaid experiment is carried out at the factory premises of the noticee. This is not a first case in which such guidelines has been given. Observations made in paragraph Nos. 20.1, 20.2, 21, 22.1, 23 and 24 of the decisions rendered by the Tribunal in the case of R.A. Castings Pvt. Ltd. v. CCE, 2009 (237) ELT 674 read as under: "20.1 From the perusal of these reports, we find that wide variations in the consumption of electricity have been reported for the manufacture of one MT of steel ingots. This renders the norm of 1046 units adopted by the Revenue as arbitrary. Why not adopt the norm of 1800 KWH/T or 1427KWH/T or 650 to 820 units/MT or 851 units/MT as per various reports referred to above or why not adopt some figure between 555 to 1046 units as norm as per Dr. Batra's report? 20.2 We note that no experiments have been conducted in the factories of the appellants for devising the consumption norms of electricity for producing one MT of steel ingots. It is the basic philosophy in the taxation matters that no tax can be levied on the basis of estimation. In this case, there is added problem. Estimation of production fluctuates widely depending upon the fact as to which report is adopted. Tax is on manufacture and it is to be proved beyond doubt that the goods have been actually manufactured, which are leviable to excise duty. Unfortunately, no positive evidence is coming on record to that effect. Article 265 of the Constitution of India says that no tax shall be levied or collected except by authority of law. Tax is on manufacture and it is to be proved beyond doubt that the goods have been actually manufactured, which are leviable to excise duty. Unfortunately, no positive evidence is coming on record to that effect. Article 265 of the Constitution of India says that no tax shall be levied or collected except by authority of law. Unless the manufacture of the steel ingots is proved to the hilt by authentic, reliable and credible evidence, duty cannot be demanded on the basis of hypothesis and theoretical calculations, without taking into consideration the ground realities of the functioning of the factories. High consumption of electricity by itself cannot be the ground to infer that the factories were engaged in suppression of production of steel ingots. The reasons for high consumption of electricity in the case of the appellants' factories have not at all been studied and analysed by the Revenue independently. Instead, the norm of 1046 units fixed as per Dr. Batra's report has been blindly applied to the appellants' cases to work out the excess production. This approach is flawed and does not have sanctity. 21. The law is well settled that the electricity consumption cannot be the only factor or basis for determining the duty liability that too on imaginary basis especially when Rule 173-E mandatorily requires the Commissioner to prescribe/fix norm for electricity consumption first and notify the same to the manufacturers and thereafter ascertain the reasons for deviations, if any, taking also into account the consumption of various inputs, requirements of labour, material, power supply and the conditions for running the plant together with the attendant facts and circumstances. Therefore, there can be no generalization nor any uniform norm of 1046 units as sought to be adopted by the Revenue especially when there is no norm fixed under Rule 173-E till date by the Revenue and notified by it. The electricity consumption varies from one unit to another and from one date to another and even from one heat to another within the same date. There is, therefore, no universal and uniformly acceptable standard of electricity consumption, which can be adopted for determining the excise duty liability that too on the basis of imaginary production assumed by the Revenue with no other supporting record, evidence or document to justify its allegations. There is, therefore, no universal and uniformly acceptable standard of electricity consumption, which can be adopted for determining the excise duty liability that too on the basis of imaginary production assumed by the Revenue with no other supporting record, evidence or document to justify its allegations. In the following case laws, it has been held that the consumption of the electricity alone is not sufficient to determine the production; (i) Pure Enterprises (P) Ltd. v. CCE, Rajkot, 1999 (111) E.L.T. 407 (Tri.) (ii) Kapadia Dyeing Bleaching and Finishing Works v. CCE, Surat, 2000 (124) E.L.T. 821 (Tri.) (iii) A. Arti Leathers (P) Ltd. v. CCE and C, Ahmedabad, 2001 (136) E.L.T. 1255 (Tri.Mum.) (iv) Parshuram Cement Ltd. v. CCE, Lucknow, 2003 (160) E.L.T. 213 (Tri.Del.) (v) Mukesh Dye Works v. CCE, Mumbai VI, 2006 (196) E.L.T. 237 (tri.Mum.) (vi) Hans Castings Pvt. Ltd. v. CCE, Kanpur, 1998 (102) E.L.T. 139 (T) (vii) M/s. Padmanabh Dyeing and Finishing Works v. CCE, Vadodara, 1997 (90) E.L.T. 343 (T) (viii) M/s. Madhu Products v. CCE, Hyderabad, 1999 (111) E.L.T. 197 (T). 22.1 For want of evidence relating to the above points, clandestine removal cannot be sustained merely on the basis of the technical opinion report of Mr. Batra. In this connection, the following case laws are relied: (i) Emmtex Synthetics Ltd. v. Commissioner of Central Excise, New Delhi 2003 (151) E.L.T. 170 (Tri.Del.); (ii) Commr. of Central Excise, Chennai v. Dhanavilas (Madras) Snuff Co. 2003 (153) E..T. 437(Tri.Chennai); (iii) Commissioner of Central Excise, Madurai v. Madras Suspensions Ltd. 2003 (156) E.L.T.807 (Tri.Chennai); (iv) Commissioner of Central Excise, Coimbatore v. Sangamitra Cotton Mills (P) Ltd. 2004 (163) E.L.T. 472 (Tri.Chennai); (v) Commissioner of Central Excise Coimbatore v.Velavan Spinning Mills 2004 (167)E.L.T. 91 (Tri.Chennai); (vi) M. Veerabadhran and others v. Commissioner of Central Excise, Chennai-II 2005 (182) E.L.T. 389 (T) : 2005 (98) ECC 790 (T). 23. 23. The Tribunal has consistently taken the view that wherever electricity consumption alone is adopted as the basis to raise demands, the order of the lower authorities have been held to be unsustainable in law and set aside and the Revenue had been directed to carry out experiments indifferent factories on different dates to arrive at the average to be adopted as a norm, which can be followed thereafter and the Revenue in the present case not having conducted any experiment whatsoever cannot be permitted to justify the demands raised. It will be appropriate on the part of the Revenue to conduct experiments in the factory of the appellants and others and that too on different dates to adopt the test results as the basis to arrive at a norm, which can be adopted for future. The impugned demand based merely on assumptions and presumptions cannot, therefore, be sustained nor could be justified both on facts and in law. 24. The law is well settled that in every case of alleged clandestine removal, the onus is on the Revenue to prove what is alleges with positive and concrete evidence. In the absence of any positive evidence brought by the Revenue to discharge its onus, the impugned order cannot be sustained." (emphasis supplied) (ix) The aforesaid decision has been upheld by the Division Bench of Allahabad High Court in a decision 2010 (1) taxman.com 342 (Allahabad) and SLP preferred against the said decision has also been dismissed by the Hon'ble Supreme Court. Thus, the report of Dr. N.K. Batra has been several times, criticized by various adjudicating authority vis-a-vis clandestine removal and the respondent-department has also issued a circular dated 26.06.2014 and several times such notice has also been dropped while passing the Order-in-Original, as stated hereinabove, as pointed out by the counsel for the petitioners. Despite these facts, in violation of such directions and the circular of the department, the respondents are still issuing show cause notices, levelling allegations of clandestine removal of the finished product, based upon the electricity consumption pattern shown by Dr. N.K. Batra. We, therefore, direct the respondents not to mention Dr. N.K. Batra's report in their show cause notice unless an experiment is carried out by the respondent department in the factory premises of the notice for production of 1 MT or for production of more than sufficiently large quantity like 1000 units etc. N.K. Batra. We, therefore, direct the respondents not to mention Dr. N.K. Batra's report in their show cause notice unless an experiment is carried out by the respondent department in the factory premises of the notice for production of 1 MT or for production of more than sufficiently large quantity like 1000 units etc. in any other cases, because electricity consumption depends upon the nature of machinery. Even two refrigerators of same kind and type and capacity may not have the same consumption of electricity, because one may be new and another may be old. (x) Likewise such type of other reports are also available in this country, which are as under: (a) Dr. N.K. Batra's report (b) Report by Joint Plant Committee constituted by the Ministry of Steel, Government of India. (c) Report of NISST, Mandi Gobindgarh given in June-July, 2006. (d) Report of Executive Director, All India Induction Furnace Association, New Delhi, and all these reports say different electricity consumption, per ton. These facts have been referred in paragraph nos.19 & 20 of the decision 237 ELT 674 and the same reads as under: "19. The main question to be decided in the instant appeals here is whether the appellants during the period December 2001 to March, 2005 have actually manufactured M.S. Ingots in excess of what has been recorded in their statutory records and removed the said quantity clandestinely from their factory without payment of duty. The excess production has been worked out on the basis of electricity consumption for which the standard norms are imported from report of late Mr. N.K. Batra, Professor of Material and Metallurgical Engineers, IIT Kanpur. 20. We find that the following reports have been referred to either by the appellants or the Revenue laying down the norms for the consumption of electricity for the manufacture of one MT of steel ingots: (i) 555 to 1046 (KWH/T) as per Dr. N.K. Batra, Professor of Material and Metallurgical Engineers, IIT Kanpur. 20. We find that the following reports have been referred to either by the appellants or the Revenue laying down the norms for the consumption of electricity for the manufacture of one MT of steel ingots: (i) 555 to 1046 (KWH/T) as per Dr. Batra' report; (ii) 1800 KWH/T as per the report by Joint Plant Committee constituted by the Ministry of Steel, Government of India; (iii) 1427 KWH/T as per the report of NISST, Mandi, Gobindgarh given in June-July, 2006; (iv) 650 units to 820 units/MT as per the Executive Director, All India Induction Furnace Association, New Delhi; (v) 851 units/MT in the case of Nagpal Steel v. CCE, Chandigarh 2000 (125) E.L.T. 1147 ." (emphasis supplied) In view of the aforesaid electricity consumption report, per tonnage, it appears that the variation is from 555 units to 1800 KWH/Per Ton. This is mainly because of the nature of the machinery utilized by the noticee. Looking to the facts of the present case, the electricity consumption pattern as has been given in Annexure-G of the show cause notice, which reveals that this petitioner has consumed electricity absolutely in consonance with the report given by Joint Plant Committee, constituted by the Ministry of Steel, Government of India and for few months it is even less than that. Thus, there are varieties of report available in the markets, one could not have been chosen by the respondents, arbitrarily, without carrying out the experiment of consumption of electricity for one ton of manufacturing at the noticee's manufacturing unit. This type of experiment is a must by the department, whenever respondents are canvassing the ground of electricity consumption pattern vis-a-vis clandestine removal of finished products. Otherwise, without such experiment, if any one of the aforesaid report relied upon, then it is arbitrariness on the part of the respondents and whenever there is any arbitrariness, there is always violation of Article 14 of the Constitution of India, because for few of the noticees such type of reports are not relied upon, whereas, for rest of the assessees, as per the choice of the respondents, such type of reports will be relied upon and in fact, this has happened in this case. Several Orders-in-Original have been pointed out during the course of arguments by the counsel for the petitioner wherein, electricity consumption pattern allegation levelled in show cause notice and ultimately after adjudication, the show cause notice has been dropped. Thus, without experiment is being carried out at the premises of the noticee, use of any of the committee's report for electricity consumption pattern always leads to arbitrariness on the part of the respondent-department. Whenever arbitrariness is present, equality is absent. Equalities and arbitrariness are strong enemies of each other. When equality is present, arbitrariness is absent. 6. Hence, this Court is remanding the matter to the Joint Commissioner, Central Excise & Service Tax, Jamshedpur. This Court is not much going into detail of further arbitrariness in the Order-in-Original. There appears to be very high sounding reasons, but, if they are viewed with zoom lens camera, it appears that nothing is proved by the respondents. 7. The Order-in-Original is based upon mere presumptions and possibilities, and, nothing has been proved at all by the respondents, especially unaccounted manufacturing of M.S. Ingots and the clandestine removal thereof. 8. We, therefore, quash and set aside the Order-in-Original passed by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur dated 18/19.02.2016 (Annexure 4 to the memo of this writ petition) as well as the Appellate Order passed by the Goods & Service Tax and Central Excise (Appeal) dated 14.07.2017 ( Annexure-5 to the memo of this writ petition). 9. As a cumulative effect, as the Order-in-Original passed by the Joint Commissioner, Central Excise & Service Tax, Jamshedpur dated 18/19.02.2016 (Annexure 4 to the memo of this writ petition) and the Appellate Order passed by the Goods & Service Tax and Central Excise (Appeal) dated 14.07.2017 (Annexure-5 to the memo of this writ petition) are quashed and set aside, the matter is remanded for adjudication of the show cause notice dated 05.11.2014 and the matter will be decided afresh, keeping in mind the aforesaid principles, especially if the respondents are relying upon Dr. N.K. Batra's report, the experiment shall be carried out at the premises of petitioner, as stated herein above, for manufacturing of one ton or any such quantity which should be sufficiently large, so as to understand the pattern of consumption of electricity for manufacturing of M.S. Ingots as well as keeping in mind the nature of evidences as referred in para 5(v) may also be collected as far as possible. 10. Accordingly, this writ petition is allowed and disposed of. Petition allowed.