2014 (5) TMI 1011

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.... the appellant take Cenvat credit of the duty paid on molasses. On being asked by the department to report whether there is any transit loss in transfer of molasses from sugar mill to distillery unit, the appellant vide their letter dated 29/5/09 reported loss of 1675 qtls. during 2007-2008 and 460 qtls. of molasses during 2008-2009 (total loss of 2135 qtls.) and mentioned this loss as transit loss. The department on the basis that this much quantity of molasses had not been received in the distillery and Cenvat credit has been taken in respect of the same, issued a show cause notice for denial of Cenvat credit and its recovery alongwith interest and also for imposition of penalty on them. The show cause notice was adjudicated by the Assist....

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.... and disposal of the molasses in the format prescribed by the State Excise authorities, that from these records, it is clear that during every month, there was some storage loss/storage waste of molasses, which had been reflected in these records and those records had been checked by the State Excise Authorities, that the total of the storage losses for the period from June 2007 to February 2009 comes to 2135 qtls., that it is this loss which had been reported to the Jurisdictional Central Excise authorities as transit loss by mistake, while it is actually storage loss, that since it is 0.45% of the total quantity received, the same is within the limit of 2% storage loss prescribed as condonable by the Board, that on the issue as to whether....

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....mitted that the loss of 2135 qtls. Of molasses as transit loss and not storage loss and when this much quantity had admittedly not been received, they would not be entitled for Cenvat credit, that longer limitation period had been correctly applied, as this transit loss was never reported to the department, that the appellant's plea that this loss is storage loss and not transit loss, is not acceptable as they themselves have reported this loss as transit loss and that even in the ER-6 returns, the appellant have shown the losses as transit losses. He, therefore, prayer for rejection of the appeal. 3. I have carefully considered the submissions from both the sides and perused the records. 4. While it is true that the appellant vide th....