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2013 (8) TMI 384 - AT - Central ExciseClandestine removal of finished goods i.e. Transformer – Held that:- In the Panchnama itself it has been recorded that when Shri Dubey of the respondent company was asked about the 10 missing transformers, he explained that the same have been put in the oven, but the oven was not opened at that time as it was not feasible to do so - Shri Ravi Dubey of the appellant company in his statement dated 12-9-1997 recorded under Section 14 of Central Excise Act, 1944 has made the statement that the 10 transformers had been put in the oven for reovening. Just because there was no entry in the RG-1 register regarding transfer of 10 transformers from the bonded store room to the manufacturing section of the factory for reovening and when this fact was told to the officers at that time but still they did not verify, it cannot be concluded that there was unexplained shortage of 10 transformers - Duty demand on the 10 transformers set aside. Shortage of input 30.745 M.T. of BP sheets and 29.65 M.T. of CRGO electrical steel sheets – Cenvat credit taken on the inputs – Held that:- These shortages had not been detected by comparing their stock available in the factory at the time of officer’s visit on 12-9-1997 with the stock as reflected in RG-23A Pt. I register - In respect of BP sheets Investigating officers added the quantity issued for manufacturing during period from 1-9-1997 to 12-9-1997 to the stock of BP sheets as reflected in RG-23A Pt. I register and, thereafter, compared this total with the stock of BP sheets lying in store room as well as in the factory in various stages of processing - The shortage in respect of CRGO sheets has also been determined in the same manner - In ascertaining the stock of cenvated inputs in this manner the officers have not taken into account certain quantity which was available in the factory and certain quantity which has been used in the manufacture of finished goods - Department has not been able to prove that there was actual shortage of BP sheets and CRGO sheets as alleged in the show cause notice – Decided against the Revenue. Clandestine removal of 14.124 M.T. of wires and strips in respect of which Cenvat credit had been taken – Held that:- Allegation is based on the presumptive consumption of this item by the department and as such there is no evidence regarding any removal of this item without payment of duty – Revenue allegation is based on the presumption of total quantity supposed to have been consumed on the basis of GTP specifications - Consumption is not always according to the GTP specifications and can be higher also – Cenvat Credit demand dropped – Decided against the Revenue. Illicit removal without payment of duty of 9 M.T. of cenvated wires and strips which is shown to have been destroyed in fire in 1994 and 1995 - Appellant’s claim is that this large quantity of wires and strips was contained in the newly made as well as repaired transformers which had been totally destroyed in fire accidents in the factory in 1994 and 1995 – Held that:- Neither the respondent had reported about any fire accident during this period nor any claim for remission of duty on the transformers claimed to have been lost in fire have been made - In this case neither there is any evidence of loss of finished goods due to fire nor any claim for remission of duty on the finished goods lost in fire has been made - The respondent, therefore, would be liable to pay duty equal to the amount of Cenvat credit availed on 9,000 kg. of wires and strips - The respondent would also be liable for penalty under Rule 57-I(4) for taking this wrong Cenvat credit – Decided in favor of Revenue.
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