2002 (1) TMI 353

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....ral Excise Commissionerate, Jaipur-I on 6-10-97. On verification of the records and on taking the stock of the raw materials and the end products, it was found that a total 1,977 meters of PVC coated fabric were short as against the recorded balance in RG-1 register. These goods were valued at Rs. 88,965/- involving the Central Excise duty of Rs. 20,462/-. Similarly, on stock verification of modvatable inputs, a shortage of 3360 kgs PVC resin, 400 kgs of DOP and 2025 kgs of Benzoplast were noticed as against the recorded balance of these items in their RG-23A Part I account. All these inputs found short were valued at Rs. 3,57,798/- involving credit of Rs. 72,310/-. The statement of Shri Lallan Singh, General Manager of the party was record....

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....her imposed a penalty of equivalent amount on the party under Section 11AC read with Rule 57-I(4) and a penalty of Rs. 5,000/- under Rule 173Q. 4. The party filed an appeal but the same stood rejected vide order dated 15-5-2000 passed by the Commissioner (Appeals), Jaipur. 5. The present appeal is against the impugned order of Commissioner (Appeals), Jaipur. I have heard Shri K.K. Anand, ld. Advocate and Shri V.K. Verma, ld. JDR for the respondents. The ld. Counsel for the appellants very fairly admitted that the appellants are not contesting the amount of duty confirmed on them in respect of the end products found short as also for the shortage of the input material on which Modvat credit had already been availed. He submit....

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....volving the Central Excise duty of Rs. 20,462/- were found short on verification of the stock. Similarly, there was a shortage of input material on which the Modvat credit amounting to Rs. 72,310/- had been availed. Shri Lallan Singh, General Manager and authorised signatory of the party in his statement dt. 6-10-97 admitted the shortages and stated that the finished goods were short due to less recording of quantity despatched and the shortage in raw materials occurred due to receipt of less quantity in the factory premises. This statement is not disputed till date and in fact, the appellants debited excess Modvat credit voluntarily in their RG 23A Part II. This leads to conclusion that the appellants had cleared the end products without p....

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....ent to be found in the show cause notice. There is no averment that the duty of excise had been intentionally evaded or that fraud or collusion had been noticed or that the assessee was guilty of wilful mis-statement or the suppression of fact." However, in the case under consideration the facts are entirely different. Further reliance on the decision of the Hon'ble Madras High Court in [2001 (133) E.L.T. 536 (Mad.) = 2000 (47) RLT 383 (Mad.)] is also not correct. In this judgment, it is observed, "Despite prescription of penalty in the statutory provision, the element of discretion still lies and what is provided in the provision is the maximum. Discretion, which should no doubt be exercised judiciously, can be exercised, having due regard....