AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2020 (6) TMI 224
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....cees. 2. The facts in brief for the purpose are as follows: 2.1 M/s Balajee Steel Industries are engaged in the manufacture of MS Angle, Bar, Round, Square, Flat etc. They are also availing Cenvat credit of duty paid on the inputs and capital goods as provided under Cenvat Credit Rules 2004 and utilizing such credit towards payment of duty on their final products. Acting upon intelligence about the appellant to be engaged in clandestine removal of excisable goods, the factory premises of appellant were searched on 18.01.2012. 2.2 On comparison of the physical stock of their finished goods and raw materials with that of the declared stock, the officers found shortage in the stock of Round/Square/Bar, Angle, Flat, MS Scrap(finished g....
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....ecessary entries in their statutory records and without payment of Central Excise Duty with the intention to evade payment of duty and an amount of Rs. 39,24,978/- was proposed to be recovered along with interest at appropriate rate and proportionate penalties. 2.8 The Ld. Joint Commissioner vide its order in original dated 28.03.2016 confirmed the demand of Central Excise Duty of Rs. 39,24,978/- along with interest and penalty. Also imposed Rs. 5,00,000/- penalty on Shri. JP Agarwal under Rule 26 of Central Excise Rules, 2002. Further Commissioner Appeals upheld the adjudication order vide order dated 05.09.2017. Hence the present Appeals before this Tribunal. 3. I have heard Mr. Manish Saharan, learned Counsel for the Appellant and ....
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.... aside and the appeals are prayed to be allowed. 3.5 To rebut these submissions it is mentioned by ld DR that the allegation made in the SCN issued to the Noticees are based on the information reflected in the documents containing data and the outcome of physical stock verification of Noticee No. 1 evidencing shortage of stock of finished goods and raw materials, as was conducted by Central Excise officers in the presence of independent panchas and representatives of the Noticee No.1. This fact of the shortage was accepted by one of the directors of the company in his statement. The said evidence and said statement has been relied upon by the adjudicating authority below while confirming the demand. Hence there is no infirmity in the ord....
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....llahabad in the case of Continental Cement Co. Vs Union of India reported as 2014 (309) ELT 411 (Allahabad) had earlier laid down the criteria of investigation to prove the allegation of clandestine sale in following words: "Further, unless there is clinching evidence of the nature of purchase of raw materials, use of electricity, sale of final products, clandestine removals, the mode and flow back of funds, demands cannot be confirmed solely on the basis of presumptions and assumptions. Clandestine removal is a serious charge against the manufacturer, which is required to be discharged by the Revenue by production of sufficient and tangible evidence." 4.3 On careful examination, it is found that with regard to alleged removals,....
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.... by the appellant. Panchnama dated 19.01.12 clearly recites that physical verification of the stock could not be conducted. From SCN also I also observe that the said stock was ascertained by counting the number of bundles of the same and multiplying the same with the weight of each bundle. The entries of record about loading and unloading of stock were admittedly in cryptic manner and admittedly been deciphered in department's own interpretation. Thus I am of the opinion that stock taking is merely on eye estimation basis. In the case of Shiva Steel Rolling Mills vs CCE Kolkata 2005 (186) ELT 326 (Tri. Kol) it was held that Stock verification done only on the basis of eye estimation and not to be the basis for quantifying demand for decidi....
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....is of sectional weight but at the time of clearance of goods, we take actual weight for payment of duty." 4.9 With respect to loose papers also Mr Agarwal replied: "These papers are rough papers, may be maintained by any person such as any transporter, broker, vendor etc. I have no idea about these papers. Transporters/ brokers frequently visit our factory. The papers might have been relating to such persons." 4.10 I hold that none of these explanations amount to admission on part of director of the appellant about clandestine removal of their goods. Question of these statements to be the corroboration of alleged guilt does not at all arise. 4.11 In the case of Kanpur Strips Ltd. Vs CCE Kanpur 2001(137) ELT 1198 (Tri-Del) ....