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2010 (3) TMI 67 - PUNJAB & HARYANA HIGH COURTDemand – shortage of raw material - On 15.7.1998, the officers of Central Excise (Preventive), Division-II, Gurgaon visited the premises of the factory and in the followup action and interception of a tempo in transit it was found that the tempo was carrying finished goods of the respondents. On physical verification of the stock, there was shortage of raw material and shortage as well as excess quantities of different types of finished goods were found which involved a total duty of Rs.2,41,460/-. Held that - a tempo carrying the finished product manufactured by the respondent was intercepted and it was found that non duty had been paid on the goods being carried in the tempo. It is thus, clear that the respondent was trying to remove the goods in the tempo clandestinely. We are of the considered opinion that penalty can only be imposed on the goods which were removed from the premises and intercepted in the tempo. Thus, the respondent is liable to pay penalty on the goods which were removed in the tempo from the factory premises and the same were intercepted - However, the goods which were not removed from the factory premises and were still lying, although some of the invoices had not been entered in the Register, no penalty would be leviable as no clandestine removal had taken place.
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