TaxTMI 
TaxTMI 
2012 (2) TMI 431
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....ion that there was a shortage in the stock of black steel tubes to the extent of 314.016 MTs being the difference between the physical stock in the factory on that day and the stock as accounted in their registers. Revenue was of the view that this shortage was due to clandestine removal of manufactured goods. On that basis, they issued a demand of excise duty payable on such goods found short. The Show Cause Notice has been adjudicated confirming the duty demand of Rs. 11,04,840/- along with interest and penalty under Section 11AC. On Appeal filed by the Appellants with the Commissioner (Appeals) they did not get any relief and aggrieved by the order of the Commissioner (Appeals), the Appellants have filed this Appeal. 2. The Counsel....
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....isation of the pipes into the light, medium and heavy and assuming a linear density could not have been understood by the panchas and shortage recorded in Mahazar is not a proven fact. The Revenue is also relying upon an internal record with heading "Following Material are cleared for Desptach (29/5)" showing the materials cleared for despatch on 29-5-1999 to be 1003.370 MTs. As per RG-I register the closing stock on 29-5-1999 was 1421.870 MTs. According to Revenue these records show that there was a shortage of 418.5 MTs of stock on 29-5-1999 itself that is almost one week earlier to the stock taking done by the officers. 3. The Counsel for Appellant submits that the said document indicates only the material which is cleared for des....
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....arrived at. He relies on the decision of the Madras High Court in the case of Alagappa Cements Pvt. Ltd. v. CEGAT, Chennai - 2010 (260) E.L.T. 511 (Mad.) where it was held that shortage of clinkers and excess quantity of limestone mined was sufficient to conclude clandestine manufacture and the High Court upheld the demand for duty. He also relies on the decision of Himachal Pradesh High Court in the case of C.C.E. v. International Cylinders Pvt. Ltd. - 2010 (255) E.L.T. 68 (H.P.) where High Court upheld the demand for duty on stock of goods found short. 6. We have considered argument on both the sides. We are of the view that before coming to a firm conclusion about the shortage detected during the stock taking the nature of commodit....