TaxTMI 
TaxTMI 
2009 (4) TMI 908
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....Registration No.J-II/Sec. A/4/94/72,73,84 & 88 engaged in the manufacture of CI Socket, Anchor Plate, G.M. Balls, Ingot Mould, C.I. Plate, Mould Boxes etc. falling under Chapter 73, 84 and 88 of Central Excise Tariff Act, 1985. Shri V.K.Jaiswal is the Director of JSPL. Both the units were availing Cenvat credit facility. On 25.6.99 both the units were visited by the Central Excise Officers. 1.2 In the factory of JSEP, shortage of 56.915 M.T. of Pig Iron and 232.125 M.T. of C.I. Scull scrap was found. 1.3. In the factory of JSPL so far as raw material is concerned, shortage of 28 MT of Pig Iron, 128.58 MT of C.I. Scull Scrap and 416 pieces of back plate and clips was found and 13.43 MT of excess stock of runners & risers were found and as regards the finished goods, shortage of 1343 pieces of C.I. sole plate and 653 pieces of C.I. brake block was detected. Besides this, excess quantity of finished goods 2780 pieces of C.I. socket 'B', 635 pieces of C.I.socket C, 1829 and 1709 pieces of C.I. brake block and 50 pieces of C.I.brake block TPL 202 was detected. Since Shri Utpal Kumar Ghosh, Authorised Signatory of JSPL and Shri V.K.Jaiswal, Direc....
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....MT of Pig Iron and 58.475 MT of C.I.scull valued at Rs. 3,55,471/- and Rs. 2,92,375/- respectively, held to be in excess of the adjusted recorded stock in Form.IV /RG.23 Part-I, was ordered to be confiscated under Rule 173Q(1) of Central Excise Rules,1944 with option to be redeemed on redemption fine in lieu of confiscation of Rs.one lakh, in addition for payment of duty and besides this penalty of Rs. 50,000/- was also imposed on M/s. JSEP under Rule 173Q(1) of Central Excise Rules,1944. On appeal against this order, the Commissioner(Appeals) vide order-in-Appeal No.122/RPR-II/06 dt.12.12.06 set aside the Additional Commissioner's order on the ground that when during stock checking either finished goods or cenvated raw-material are found short and the Deptt. demands differential duty on the finished goods/cenvated raw-material found short, in such cases, there is no requirement to modify the recorded balance of such goods as indicated in the RG.I/Form IV/RG.23 Part.I register, as what is recorded by the factory owner in the RG.I/Form IV/RG.23 Part I register has been taken by the Deptt. as the correct quantity of the goods, that should have been available in the ....
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....e his comments/written submissions by 21.5.09. Though the Counsel representing M/s. JSPL and JSEP filed the written submissions in respect of these three appeals on 30.4.07, Shri S. Gautam, Ld. DR filed his written submissions only on 10.7.09. 2.1.The submissions made by the Ld. Counsel for M/s. JSPL and JSEP are, in brief, as under: (Appeals filed by M/s. JSPL) (1) So far as cases against M/s. JSPL are concerned, at the time of officer's visit on 25.6.99 while excess was found in respect of finished goods namely C.I. socket B, C.I. socket C, C.I. brake block 6158, C.I. brake block 97022, C.I. brake block TPL 202, C.I.brake block 289 with total weight of 165.495 M.Ts., the shortage of cenvated raw-material detected in respect of Pig Iron and C.I. scull scrap was 156 M.T. The reason for shortage in the stock of raw-material and excess in the stock of above mentioned finished goods was that the records had not been updated for quite some time. It is clear that the above mentioned excess finished goods totally weighing 165.495 M.Ts. had been manufactured out of the raw-material weighing 156 m.ts. which had been found short. In view of this, no duty can....
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....t they have failed to do so. Moreover, this argument is also incorrect, as for the manufacture of 165 m.t. of finished goods much more quantity of raw-material was required to allow burning loss processing loss etc. while the shortage of Pig Iron and C.I.Scull was about 156 MT only. (2) The contention of M/s. JSPL that shortage/discrepancy in respect of certain items of finished goods has come due to error in the method of calculation which was done on the basis of eye estimation, is baseless, as physical verification was done by counting different types of finished goods as mentioned in Panchnama and the authorized representative of the company was present at the time of physical verification and he did not raise any objection. (3) The Commissioner(Appeals) has rightly confirmed the duty demand on 153.36 M.T. of C.I. scull scrap found short in the factory of M/s. JSPL on 18.8.2000. No cogent explanation for this shortage had been given by the Company. (4) The Commissioner(Appeals) in the case of JSPL has rightly held that shortages found on 18.8.2000 cannot be adjusted against the shortages in stock found on 25.6.99. The Appellate Authority has rightly c....
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....of C.I. scull was detected and on this basis, the duty in respect of these items was demanded by treating the book entries regarding quantity in respect of these items as correct. Having done so, the Deptt. cannot ask the manufacturer to correct the quantum of shortage and on this basis allege that as on 18.8.2000, there was excess stock of Pig Iron and C.I. scull to the extent of 56.424 m.t. and 58.475 m.t. respectively while as per the unadjusted book balance as on 18.8.2000 in respect of these items, there was no shortage or excess. I, therefore, hold that the very basis of the Deptt.'s case against the respondent is wrong and I find that there is no infirmity in the impugned order-in-appeal No.122/RPR-II/06 dt.12.12.06 passed by Commissioner(Appeals), Raipur. 4. Coming to the Appeals No. E/1178-79/07-SM filed by M/s. JSPL against the Commissioner(Appeals) No.8-9/RPR-II/07 dt.29.1.07, the Deptt.'s allegation is that at the time of surprise checking on 25.6.99, there was shortage to the extent of 28 m.t., 128.58 m.t., and 416 pieces respectively in respect of cenvated Pig iron, C.I. scull scrap and back plate and clips respectively and besides this, so....