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2018 (10) TMI 1549 - AT - Central ExciseClandestine removal - shortage of raw material, finished goods and capital goods - appellant allegedly removed raw material and capital goods to their job worker which are their own unit and inputs were also removed to their godown outside the factory - demand also based on LRs. Demand of ₹ 27,466/- on the shortage of finished goods - Held that:- This demand is based on the shortage found out during the physical stock verification by the officers in the presence of representative of the appellant - Since the shortage was not disputed at the time of punchnama and thereafter no explanation was made, demand confirmed on shortages of ₹ 27,466/- is sustainable - demand upheld. Demand of ₹ 14,93,495/- on the raw material and capital goods seized on job workers premises as well as godown of the appellant - Held that:- If it is established on the basis of documents that the goods which were seized were brought back to the appellant’s factory and the same were used in the manufacture of final product which were cleared on payment of duty, then no demand shall exist. Consequently, no penalty will be imposable - this issue needs to be reconsidered on the basis of verification of the documents - matter on remand. Demand of ₹ 13,28,814/- based on LRs - principles of natural justice - Held that:- Except the transporters’ LRs and statement, there is no other evidence. The LRs submitted by the transporters is a 3rd party document which can only be relied upon after cross examine the said transporters - In the present case it is not only a 3rd party evidence but even the appellant also disputed the same and requested for cross examination. In such a situation, it was necessary for the adjudicating authority to grant the cross examination. By not allowing the cross examination, there is a clear violation of principles of natural justice - matter requires reconsideration. Appeal disposed off.
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