TaxTMI 
TaxTMI 
2020 (12) TMI 811
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....ooms 12.840 MT 72.95 MT 59.755 MT 4. Non-alloy Billets 261.00 3111.038 MT 2850.038 MT 5. Non-alloy blooms 60.040 MT 1530.018 MT 1469.980 MT 2. The department was of the view that finished goods totally valued at Rs. 22,76,79,686/- which were found short during the stock taking, had been clandestinely removed by the Appellants. 3. The department was also of the view that Notification No. 67/95CE dated 16-03-1995 was not applicable to the Appellants since it applied only to 'inputs' which are captively consumed and not to 'finished goods' as was the case of the appellants. 4. The department issued the show cause notice dated 15-09-2016 demanding Central Excise duty of Rs. 2,81,41,208/- along with interest. Penalties were proposed both against the company as well as their Managing Director, Shri Aditya Jajodia. 5. Demand was confirmed against the appellants by the adjudicating authority vide Order-in-Original No. DGR-EXCUS-COM-000-028-16-17 DT. 01-03-2017/02-05-2017. Equivalent penalty was imposed on the Company and a penalty of Rs. 10 lakhs on Sh. Aditya Jadodia, Direc....
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.... 595 (All), (v) T.G.L.Poshak Corporation vs CCE, Hyderabad reported in 2002 (140) ELT 187 (Tri-Mad) 6.3 It was submitted by various employees of the Appellant company while recording their statements that no stock taking had been done for a number of years. The Appellant's unit was commissioned 01.04.2008 whereas the sub-unit for production of DI pipes was commissioned on 01-08-2010. The difference noted in the stocks of various items was the accumulated difference over the whole of the production period. If one compares the shortages noticed at the time of stock taking with the quantity produced over the years the percentage difference comes to a miniscule amount as indicated in the table below: S. No: Descripti on of finished goods Quantity found physically in December , 2012 Stock as per DSA/ stock ledger Quantity produced from 1.4.2008 to 31.12.2012 Quantity found short at the time of stock taking Perce ntage on the basis of colum n (4) Perce ntage on the basis of colum n (5) ....
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....ment in June, 2016, itself about the quantity of DI Pipes recycled and that these were reflected in the DI scrap Account and shown in monthly ER-1 returns but were, inadvertently, not reduced in the DI Pipe stock account. Hence, there was no actual shortage in respect of DI Pipes and that it was only an accounting/recording error. These factual submissions have not been countered and denied by the Adjudicating Authority. 6.8 The rejected DI Pipes which were recycled in the factory of the Appellants were eligible for exemption under Notification No. 67/95-CE dated 16-03-1995 as these items had been captively consumed in the manufacture of dutiable finished goods. The Adjudicating Authority has erroneously held that this notification applies only to 'inputs' and not to 'finished goods'. In this regard, attention is invited to the wordings of the above Notification . The word 'input' includes all goods covered in the First Schedule to the Central Excise Tariff Act, 1985, other than light diesel oil, high speed diesel oil and motor spirit. Hence, DI pipes are also 'inputs' as per the said Notification. The learned Adjudicating Au....
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.... proportionately reversing the Cenvat credit on inputs attributable to DI Pipes cleared without payment of duty during the relevant period. 6.11 Shri Aditya Jajodia, being the MD, was not associated with dayto-day functions of the unit. There is no indication of his involvement. Hence, no penalty could be imposed on him. 6.12 The demand is time barred as the show cause notice has been issued on 15.09.2016 for the alleged clearances in 2012. There is no ground for alleging any deliberate mis-statement or suppression of facts to invoke the extended period. At best it is a case of improper maintenance of records and not a case of clandestine clearance. Further, the unit had been subjected to EA-2000 Audit in March 2012 and no discrepancy in records was found. 7. The learned AR reiterated the findings of the adjudication order and submitted that the appellants had not been able to give any satisfactory explanation for the shortages and, therefore, the allegations in the show cause notice have been rightly upheld by the adjudicating authority. 8. Heard both sides through video conferencing and perused the appeal records. 9.&....