TaxTMI 
TaxTMI 
2012 (12) TMI 767
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.... duty by under reporting their production and clandestine clearances, the factory premises of the appellant company alongwith residential premises of the Director Shri Jiwan Singla were search by the offices of Directorate General of Central Excise Intelligence (DGCEI) on 13/2/09. In course of search of the factory in premises of Shri S.P. Gupta, Authorised Signatory of the appellant company. It was found that:- (a) there was shortage of 77 M.T. of imported HM scrap involving Cenvat credit of Rs. 1,20,551/- and (b) a truck with registration No. HR 68 7637 loaded with 1.725 M.T. of kabari scrap was found which was not accompanied by any bill. The Cenvat credit of Rs.1,20,551/- involved on the 70 M.T. ....
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....purchases of scrap/sponge iron were reflected in the RG-23A register and it appeared that the M.S. Ingots manufactured from this unaccounted kabari scrap/sponge iron had been cleared clandestinely without payment of duty. Inquiry were also made with Shri Darshan Singh, Purchase Supervisor of the appellant company who in his statement dated 21/4/09 corroborated the statement of Shri S.P. Gupta. Shri Jiwan Singla in his statements dated 16/2/10 and 2/7/10 could not give any explanation for the above unaccounted purchases of scrap and sponge iron. 1.3 It appeared that from unaccounted purchase of 2595 M.T. of scrap/sponge iron, 2466 M.T. of M.S. Ingots valued at Rs.5,83,50,492/- valued at Rs.5,83,50,492/- had been manufactured which had been ....
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....-) already paid by the appellant during investigation against their duty liability; and (e) imposition of penalty on the appellant company under Section 11AC and on its Director Shri Jiwan Singla under Rule 26 of the Central Excise Rules, 2002. 1.6 The above show cause notice was adjudicated by the Commissioner vide order-in-original dated 19/1/12 by which:- (a) while the duty demand of Rs.12,25,700/- was dropped, the duty demand of Rs. 86,63,220/- (Rs. 84,14,141/- + Rs. 2,49,079/-) was confirmed alongwith interest and the amount of Rs.16,20,551/- already paid was appropriated towards this demand; (b) penalty of Rs. 86,63,220/- was imposed on the appellant company under Section 11....
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....ntity of the scrap in stock had been determined by estimate only, that the appellant have a strong prima facie case and, therefore, the amount of Rs.16,20,551/- already deposited by the appellant may be considered sufficient for the hearing of these appeals and the requirement of pre-deposit of balance amount of duty demand, interest and penalty may be waived for hearing of the appeals and recovery thereof may be stayed till the disposal of the appeals. 4. Shri Bharat Bhushan, the learned Senior Departmental Representative, opposed the stay applications and reiterating the findings of the Commissioner in the impugned order and emphasised that:- (a) on the date of officers' visit to the factory, one truck loaded with Kab....
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.... shortage is difficult to accept. Therefore, the duty demand of Rs. 2,49,079/- based on the presumption that the 77 M.T. of M.S. scrap found short had been used for manufacture of M.S. ingots which were cleared clandestinely without payment of duty appears to be on strong footing. 7. The duty demand of Rs.84,14,141/- on 2466 M.T. of M.S. ingots alleged to have been manufactured out of 2595 M.T. of M.S. scrap/sponge iron purchased unaccounted during November 2008 - January 2009 period, and cleared clandestinely is based on the entries in the loose papers recovered from the table of Shri S.P. Gupta. The entries regarding purchase of M.S. scrap/ sponge iron from various brokers/suppliers have admittedly been written by Shri S.P. Gupta and the....