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2012 (2) TMI 431 - AT - Central ExciseDuty demand - Shortage in stock - Clandestine removal of manufactured goods - Held that:- before coming to a firm conclusion about the shortage detected during the stock taking the nature of commodity and the method of stock taking done has to be taken into account. We find that the commodity involved in this case is accounted in RG-I register in MTs and the stock verification is done by measuring the length of the pipes and the number of the pipes by segregating the pipes into three broad categories of light, medium and heavy. Thereafter weight per meter for each of the three categories are assumed and total weight of all pipes is arrived at. The basis of the standard linear density adopted is not explained. There is nothing in Panchnama to show that correctness of linear density has been verified by weighing at least sample pipes from the three categories. It is very obvious that the weight per meter depend upon the thickness. Thickness of sheets used is not recorded in Panchnama. In the absence of these critical parameters the ascertained stock as per the Panchnama is not reliable. Revenue has not been able to adduce any collateral of clandestine removal. Therefore we are of the view that the quantity ascertained in the stock taking is not accurate enough to come to the conclusion that there was manufacture of goods without accounting and clearance of such goods. We also noticed that the internal record dated 29-5-2005 shows goods cleared for despatch as on that date. It is difficult to conclude that the document indicated the physical stock of goods on that day - Decided in favour of assessee.
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