TaxTMI 
TaxTMI 
2015 (2) TMI 466
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....ere not used in the manufacture of the final product, therefore Cenvat credit on these inputs was sought to be denied. Accordingly Show Cause Notice was issued which was replied by the respondent but the adjudicating authority without considering the reply, passed the adjudication order confirming the demand alongwith interest and penalties imposed. The said order was challenged before the Commissioner (Appeals) who examined the case and thereafter dropped the proceedings against which the Revenue is in appeal before me. 3. Heard the learned A.R. who submits that the respondents have admitted shortage of inputs and as per Cenvat Credit Rules, the inputs used in the manufacture of final product is entitled to Cenvat credit therefore on th....
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.... at the time of annual stock taking the respondents found shortage of raw materials and taken the same stocks in the account books. But there is no allegation of diversion of inputs which were found short at the time of annual stock taking. Further as per the Circular No. 367/87/1997 dated 19.12.1997 the CBEC, the issue was examined and was explained that for measurement of the goods for variation of temperatures and densities. From the facts of the case it is not coming out whether the respondent has done adjustment as per the Circular dated 19.1.1997 of the CBEC but it is submitted by the learned counsel that these are on actual basis. 7. I have gone through the invoices produced before me also and after going through the same I find t....
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....the shortage of raw materials found during Annual Stock taking. The Lubricating Oil was received by the appellants in sealed condition and they have produced the sample invoices, on which the actual quantity received has been mentioned. I find from the documents before me that as claimed by the appellants, there has been shortage/excess in quantity dispatched by the supplier and received by them, I find that there is substantial force in the argument of the appellants that the quantity ascertained through Dip measurement does not match due to change of temperature. Since, when temperature is less, more volume is received due to high density and the same if measured during the later hours of the day, when the temperature is high, the volume ....
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....ut Modvat credit should be allowed on the full quantity dispatched by the supplier. I am inclined to accept the said decisions and give the benefit of the same to the appellants." 8. I have gone through the case law relied upon by the learned A.R. in the case of Philips (supra). In that case the appellant has not argued the matter that the variation in measurement is marginal and have admitted the shortage of stock. Further in that case the Tribunal has not considered the decision of the Larger Bench in CCE vs Bhuwalka Steel Industries (supra). In these circumstances, the decision cannot be relied upon. Further in that case, it was held by this Tribunal that in such a case the extended period of limitation is not invocable. I also find t....