9911796707
TMI Blog2004 (3) TMI 583X X X X Extracts X X X X X X X X Extracts X X X X ..... removing aerated waters without payment of duty, the Central Excise officers visited their factory premises on 23rd May, 1994. On a scrutiny of RG-1 and Form IV register with physical stock, they found that 199 crates of Bisleri Soda and 453 crates of Thumsup were short and 14 units of essence of Limca and Thumsup in excess. They also found 30,900 Nos. of crown corks and 446.25 Kgs of Citric Acid short, than the recorded balance in the statutory records. Shri Pradeep Kesarikar was the only responsible officer available in the factory who informed the officers that there was no production on 21-5-1994 and 22-5-1994 on account of holidays. The excess quantity of goods along with incriminating records was seized. On examination of the seized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on the basis of 139 requisition slips. Out of these 139 slips 'quantity issued' has been filled in 15 slips only and the entries in the Form IV/RG I Registers were made in respect of these slips. All the quantities of raw materials intended for, were not utilized in full in the production of finished goods, as such usage of raw material and production of finished goods, depends on market requirements. The requisition slips do not by themselves constitute direct evidence on which the charge of production and clandestine removal can be sustained. Production of finished goods as per the standard formula particularly in the absence of any cogent, reliable, and conclusive evidence in respect of the so-called excess production and clearance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the finished goods, due to exigencies of demand, such excess raw material including essences, are returned to the Stores Department. Only such raw material as is actually utilized is accounted for in Form-IV and R.G. 23A Register. Shri T. Vinayak Ravi Reddy in his statement dated 6-9-1994 did not admit that the estimated excess quantity was actually produced nor that he had received the sale proceeds thereof. He only stated that on the basis of requisition slips, duty works out to Rs. 10,15,622.40. He further pleaded that process loss of 15% may be allowed and the price may be taken on cum-duty price. 6. Shri Kumar Santosh, ld. SDR contested the claims made by the appellants. He stated that the duty of Rs. 10,15,622.40 has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erials itself shows that the goods were produced out of these and clandestinely removed. Shri T.Vinayak Ravi Reddy, President of Annapurna Industries Ltd. (the appellant) in his letter dated 24-10-1994 addressed to the Superintendent of Central Excise, Anti-Evasion (Gr.III), Basheerbagh, Hyderabad has stated that the sale proceeds of Rs. 20.58 lakhs (Rs. 26,865/- for shortage and Rs. 20,31,244/- clearances as per requisition books), the company might have received part of the above sale proceeds and part may be receivable in future as it is not possible to identify the sale proceeds with that of the quantities manufactured and cleared as it is a running account. He conceded that while working out the duty on the clandestine production and r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 139 requisition slips to the production department. No evidence was shown by the appellants that the raw materials which were sent to the production department was returned back to the Stores. It was also found that the appellants were recording only that quantity of raw material in the Form IV Register for which they were showing the production in RG-1 register. Thus, they were not correctly recording the receipt of the raw materials in their Form IV register. It was also found by the officers that there was a shortage of 446.25 Kgs of Citric Acid. There was a shortage of 886.81 gross of crown corks and 199 crates of Bisleri Soda and 543 crates of Thumsup. It clearly shows that the appellants were manufacturing goods from the raw material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture of the goods, there was 15% process loss and this has not been allowed by the investigating authority while working out the demand. The ld. SDR has no objection if same is accepted and the duty confirmed by the lower authorities is reduced to that extent. It has also been stated by the ld. Consultant for the appellants that while working out the duty, cum-duty price has been taken into account for demanding duty. We find that this claim of the appellant is contrary to the facts. Since there were no invoices for clearances of the goods clandestinely removed, question of taking cum-duty value do not arise. Only the assessable value was available for the same goods on the basis of which the duty has been worked out. At no stage up ..... X X X X Extracts X X X X X X X X Extracts X X X X
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