2008 (4) TMI 262

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.... Ferro Alloys falling under Chapter 72 of the Schedule to the Central Excise Tariff Act, 1985. On 2-1-98, the Central Excise officers visited the Respondent's factory and verified the stock of finished goods. They found shortage and excess of finished goods of different description, in packed and loose conditions. On 3-1-98, Shri C.V.A. Verma, Works Manager of the Respondent-Company clarified that 4.5 M.T. of High Carbon Ferro Alloys found in excess was contaminated with foreign elements. Show cause notice was issued proposing the demand of duty on the shortage of finished goods and confiscation of the excess materials and imposition of penalty. The Adjudicating Authority confirmed the demand of duty and imposed penalty of equal amount unde....

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.... the confiscation of the excess materials, out of which 4.5 MT. contaminated materials, is not proper. He relied upon the decision of the Tribunal as under:- (a) Goenka Products v. CCE, Allahabad - 2005 (186) E.L.T. 75 (T-D) (b) M/s. Jaysynth Dyestuff India Ltd. v. CCE, Surat - 2005 (179) E.L.T. 83 (Tribunal-Mumbai) (c) M/s. Birla Yamha Works v. CCE - 2005 (183) E.L.T. 194 (T-D) (d) M/s. Jai Bharat Metal Industries v. CCE - 2005 (179) E.L.T. 361 (T-D) 4. After hearing both the sides and on perusal of the records, it is seen that the Respondent had given a Chart showing a stock position and adjustment of excess stock/shortage materials in their reply to the show cause notice and which was re-produced in the Adjudication Order ....

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....t found by the Appellant, confiscation and penalty are not warranted. In the present case, the Respondent adjusted the loose quantity of finished goods of same quality against the packed quantity, duly recorded in the RG-1 Register. So, the adjustment of packed/loose materials done by the Commissioner (Appeals) is correct. It is seen from the record that on 2-1-98, stock verification was conducted. The very next day on 3-1-98, the Works Manager of the Respondent Company in his statement stated that a quantity of 4.5 M.T. of High Carbon Ferro was contaminated with foreign elements. It is contended by the Respondent that the excess quantity of 4.5 M.T. of contaminated High Carbon Ferro cannot be considered as finished goods. It is seen from t....