AI Drafter 
TaxTMI 
TaxTMI 
2023 (5) TMI 1022
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.... 38 and 69 of the Central Excise Tariff Act, 1985. Appellants conduct annual stock verification of finished/semi-finished goods manufactured by them for every financial year. In the present appeal, the department found various differences in the physical stock of finished/semi-finished goods shown in their statement when compared with the adjusted RG-1 opening balance of stock of finished/semi-finished goods for the years 2001-02, 2002-2003 and 2003-2004. Accordingly, 3 show-cause notices dated 4.4.2003; 19.03.2004 and 7.04.2005 were issued demanding duty on the differential value of the stock as per Annexures to the respective show cause notices. In the impugned order, the Commissioner has confirmed the demands for the respective periods t....
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.... that the goods produced are recorded in RG1 based on estimation. The physical stock of goods was on the basis of volumetric estimation and its conversion into theoretical weight based on average cross-sectional weight. The goods are physically weighed only at the time of clearance of the goods from the factory/depots. Therefore, comparison of estimated production as recorded in RG1 and estimated physical stock of goods as on 31st March of each year amounts to comparison of two estimates which is inherently incorrect and leads to distorted conclusions. The excess/deficiency in stock was due to the fact that both production and physical stock taking was based on estimates whereas the clearances were based on actual weighment. Based on the ab....
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.... Ispat Nigam Ltd. vs. CCE, Visakhapatnam 4.7 He further submitted that the department having accepted the principles laid down in the judgment of the Tribunal in appellant's own case on the same facts and issue for the period from March 1988 to March 2001, the initiation of proceedings and demand of duty for the subsequent periods from 31.3.2002 onwards on identical facts and issue is against the settled law. i. Birla Corporation Ltd. vs. CCE: 2005 (186) ELT 266 (SC) ii. Jayaswals Neco Ltd. vs. CCD: 2006 (195) ELT 142 (SC) iii. CCE vs. Bigen Industries: 2006 (197) ELT 305 (SC) iv. CCE vs. Amar Bitumen & Allied Industries: 2006 (202) ELT 213 (SC) v. Indian Oil Corporation Ltd: 2006 (202) ELT 37....
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.... period 2002-2003, the total duty demanded was Rs.70.83 crores whereas the Commissioner has confirmed only Rs.26.44 crores and similarly for the year 2003-2004, against the duty demand of Rs.58 lakhs, only Rs.4,47,636/- was confirmed. The revenue thus claimed various factors as per the Board's Circulars were considered and after setting of the excess quantities the demands were limited only to the extent of shortages. 6. We find that the three show-cause notices which demanded duty were issued calculating the differential quantity between the RG1 stock and physical stock as reported by the appellant in their own statements. The learned Commissioner in the impugned order had demanded duty on the differential quantity between the ER1 retur....
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....old by the assessee to the distributors was not even doubted. It is only on the ground that the goods were not actually sold by the distributors to the physicians, which was the ground on which it was contended that the case was not covered under Section 4(1)(a). The CESTAT, therefore, in our opinion, has gone beyond the Show Cause Notice and on this ground alone, the judgment of the CESTAT dated 27-2-2009, which is the subject matter of Civil Appeal No. 3263 of 2009, warrants to be set aside. Civil Appeal No. 3263 of 2009 is, accordingly, allowed. 6.2 The Commissioner also at para 103 of the impugned order states that: "103. The last issue for consideration is the proposal for imposition of penalty under Rule 25 and 27 of the C....
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....under the proviso to Section 11A(1) of the Central Excise Act, 1944, penalty is imposable under Section 11AC read with Rule 25 of the Central Excise Rules, 2002." Emphasis applied In spite of these observations, he proceeds to impose invoke proviso to section 11A and impose penalty under Section 11AC which is legally not sustainable. 6.3 Further, the appellant's in their own case reported in 2006 (200) ELT 229 (Tri.-Bang.), the Tribunal has held that the discrepancy between the RG1 stock and the physical stock are based on the estimated production and not on actual weighment. Comparison between two estimations is inherently inaccurate. Because of these shortages, if any, is inflated due to errors in taking opening balance an....