2016 (11) TMI 474

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....hecks and verifications. As a result, certain shortages and excesses were detected in respect of which the present proceeding relate. The lower authorities have demanded duty to the extent of Rs. 4,59,238/- in respect of shortages along with imposition of penalty to the same extent. The excess found goods stand confiscated with an option to redeem the same on payment of Redemption Fine of Rs. 25 lakh. 2. It is also seen that apart from the present appellant located at Plot No. 923-945, the other units of the same appellant like Silk division, a DTA unit; Uniworth Wool division stock division, tying  a 100% EOU were also operating. It is seen simultaneous search was also conducted in the premises of Uniworth wool division a100% EOU and....

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....uantity had been found and this fact had been intimated to the Department under the appellant s letter dated 5.4.2000 and it had also been stated by Shri D.K. Kothari, General Manager in his statement dated 16.06.2000. 7. While in the factory of UL shortage of 73.904 MTs. had been found, in the factory of UTL there was excess stock of 73.904 MTs. of mixed woollen yarn and as such, we are of the view that the alleged shortage in the factory of UL matches with the excess found in the factory of UTL. We also take note of the fact that the appellant under their letter dated 5.4.2000 addressed to the Asstt. Commissioner had intimated that they have identified about 75 MTs. of moth and mildew affected wool yarn and have decided to store it sepa....

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....fting of about 45 MTs of yarn to the godown of UTL had been received by the Assistant Commissioner, he should have responded as to whether he allows the shifting or not. We also find that the Commissioner in para 13 of his order has acknowledged that both the units were under physical control. If this is so, when the appellant had informed vide their letter dated 5.4.2000 about their intention of shifting about 175 MTs. of damaged yarns to the unit of UTL and this letter had been received in the central excise officer, it was for the central excise authorities to clarify this aspect. In view of this, we hold that the alleged shortage of 73.904 MTs. in the stock of yarn in the premises of UL was not the genuine shortage and as such, the duty....

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....al product, in the absence of any further evidence on record. In the present case, I find that apart from the shortages, there is no evidence to show that clandestine production and removal of final product. Though the appellant had placed on record various decisions of the Tribunal, a specific reference could be made to Punjab and Haryana decision in the case of Commissioner of Central Excise, Ludhiana vs. Anand Founders and Engineers [2016 (331) ELT 340 (P&H)], it was held that the charges of clandestine removal based upon the alleged shortages in stock are not enough to held charge of clandestine removal. Similarly, in the case of CCE vs. Minakshi Casting [2011 (274) ELT 180 ], Hon'ble High Court of Allahabad rejected the Revenue s appe....