TMI Blog2013 (5) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... inst the respondent. However, the respondent is required to pay duty involved on such shortages which could not be explained and the respondent are liable for general penalty for the said discrepancy. Since no penal provision is invoked in the Show Cause Notice other than Section 11AC, no penalty could be imposed on that count. Thus in absence of direct or indirect involvement of the Managing Director Shri A.K. Agarwal in the clandestine removal of the goods no personal penalty under Rule 26 of the Central Excise Rules, 2002 is imposable on him. - E/419/2006 - A-614/KOL/2012 - Dated:- 27-8-2012 - Shri S.K. Gaule and Dr. D.M. Misra, JJ. Shri D.K. Nath, D.C. (AR), for the Appellant. Shri S.K. Mohanty, Advocate, for the Respondent. ORDER This is an appeal filed by the Revenue against Order-in-Appeal No. 46-47/B-I/06, dated 19-4-2006. 2. Briefly stated the facts of the case are that the respondents are engaged in the manufacture of iron and steel products for which they are registered with the Central Excise department. The appellant has discontinued their manufacturing activity in July, 2002. Their factory was visited by the Central Excise audit team on 11-2-20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 71,745/- with interest under Rule 8(3) of Central Excise Rules, 2002, dropped the demand of Rs. 9,44,003/- and penalty imposed under Section 11AC of the Central Excise Act and personal penalty imposed on the Managing Director Shri A.K. Agarwal. Aggrieved by the said order, the Revenue has filed the present appeal. 4. Ld. A.R. appearing for the Revenue submitted that the ld. Commissioner has not considered the fact that on the date of visit of the officers to the factory, the respondent had failed to show the stock of finished goods as well as raw materials recorded in their statutory Records. Further, on being asked, the Managing Director of the company had accepted the said shortage in the stocks and sought time to make good the duty involved on the said shortages. The ld. A.R. further submitted that the show cause notice has been issued alleging clandestine removal of the goods, in absence of reasonable explanation on the shortage of inputs and finished stocks, during the visit by the officers on two occasions i.e. on 11-2-2003 and 27-2-2003. The Ld. A.R. submitted that the respondent had admitted removal of two consignments without debiting duty involving a total duty of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 12. Hemson Textile Processors v. CCE, Mumbai - 2004 (177) E.L.T. 413(Tri.) 13. Sayaji Iron Engg. Co. Pvt. Ltd. v. CCE - 1990 (45) E.L.T. 104 (Tri.) 14. P.S.P. Appliances (P) Ltd. v. CCE, Delhi - 2005 (186) E.L.T. 128 (Tri.) 15. Associated Cylinder Industries Ltd. v. CCE - 1990 (48) E.L.T. 460 (Tri.) 16. CCE, Raipur v. C.M. Re-rollers Fabricators - 2004 (168) E.L.T. 506 (Tri.) 17. Parle Beverages Ltd. v. CCE, Mumbai-I - 1998 (99) E.L.T. 468 (Tri.) 18. K. Harinath Gupta v. CCE, Hyderabad - 1994 (71) E.L.T. 980 (Tri.) 19. CCE, Madras v. Systems Components Pvt. Ltd. - 2004 (165) E.L.T. 136 (S.C.) 20. CCE, Surat-I v. N.D. Textiles - 2004 (168) E.L.T. 381 (Tri.) 6 We have considered the submissions of both sides and carefully gone through records of the case. It is not in dispute that during the course of visit of the officers on 11-2-2003, the following shortages were noticed :- Finished Goods of (1) M.S. Rod : 77.953 MT (2) M.S. Scrap : 43.617 MT and inputs (1) Billet/Ingot : 412.072 MT (2) M.S. Round ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot available with them. We do not see merit in the said submission of the ld. Advocate. It is well settled principle of law that the goods manufactured in a factory are to be accounted for in their statutory production register and inputs are required to be accounted for in the Cenvat input register maintained by the assessee. The assessee is duty bound to show the physical stock of the goods as entered in their statutory register as and when demanded by the visiting officers during the course of verification of the stocks. In the event, the assessee fails to account for the shortages in the stock noticed during such verification, the liability from payment of duty on such shortages cannot be escaped. Needless to emphasize, excise duty is levied on the manufacture of goods, but for administrative convenience, collection of duty is postponed till the clearance of goods from the factory. Hence, as soon as the goods are manufactured, the same are required to be accounted/entered in the Daily Stock Account (DSA) Register i.e. RG-1 Register. The Central Excise Rules provides that in the event the goods are lost due to natural causes, remission of duty on lost goods could be applied to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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