9911796707
TMI Blog2015 (2) TMI 791X X X X Extracts X X X X X X X X Extracts X X X X ..... el. On 31.07.2002, the departmental officers visited the factory of the appellants. After entering the premises, the physical stock of the finished goods as well as the raw material was verified on the basis of eye estimation. The raw material i.e. M.S. Scrap was found to be shortage of 2042.405 M.T and the stock of finished goods M.S Ingots were almost the same as entered in the statutory records but after perusing of the M.S. Scrap which was lying in the factory on the basis of eye estimation was much less than the entry made in their statutory records. Therefore, a case was made against the appellants that there is a shortage of raw material and they have taken CENVAT credit on the differential quantity of scrap which is not admissible t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o action was taken by the department for physical weighment of raw materials despite their letter dated 01.08.2002. Therefore, demands of the shortage of stock on the basis of eye estimation cannot be confirmed against the appellants and consequently, penalties also not imposable. To support his contention he placed reliance on the decision in the case of Malwa Cotton Spinning Mills - 2003 (155) ELT 161(T), Vivek Dyechem Ind. Ltd. - 2002 (150) ELT 801 (T) and Dhebar Steel Re-rolling - 2002 (142) ELT 194 (T). 5. On the other hand, the learned A.R. opposes the contention of the learned A.R. and submits that the Director and the Production Manager were present at the time of stock verification and they have admitted the shortage of stocks. Al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8.2002 is an after-thought. I have gone through the statement of Director recorded subsequently also but these statements do not confirm the acceptance of the shortage of raw material by the Director. Further, I find that the case has been made out on the basis of Panchnama drawn during the course of investigation and the permission for cross-examination of panchas was not given to the appellants. Therefore, I hold that there is a violation of principles of natural justice. In these circumstances, I set aside the impugned order and remand the matter back to the adjudicating authority who will allow the appellants to cross-examination of panch witnesses and thereafter the adjudicating authority shall decide the matter on its own merits. 8. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
