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2015 (11) TMI 459 - CESTAT NEW DELHI

2015 (11) TMI 459 - CESTAT NEW DELHI - TMI - Confiscation of goods - Clandestine removal - Imposition of redemption fine and penalty - Held that:- when appellant is manufacturing two types of goods and while counting ingots it is not coming out from the facts of the case that how much of ingots are 3-4 inches and how much ingots are 3.5x4.5 inches. Therefore, the weighment method on average basis cannot be correct. Therefore, there may be a variation while taking the stock. In these circumstance .....

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is manufacturing two types of MS ingots. Therefore, allegation of excess stock on average basis cannot be alleged against the appellant.

Allegation made against the appellant that these goods are meant for clearance clandestinely without payment of duty is correct. Consequently, I hold that in the case of M/s. Shivangi Estate Ltd. the goods are liable for confiscation. But I find that the duty involvement in the said goods is only ₹ 31,252/-whereas redemption fine and penalties .....

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- Ashok Jindal, Member (J) For the Appellant : Ms Priyanka Goyal, Adv For the Respondent : Shri V P Batra, DR ORDER Per Ashok Jindal The manufacturer appellants are in appeals against the impugned orders holding goods are liable for confiscation. Consequently, redemption fine and penalty can be imposed and the authorized representative of the manufacturer appellants are against the order of imposing penalty on them under Rule 26 of the Central Excise Rules, 2002. As facts of the case are common, .....

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s stock was found less than 5 % of the stock recorded in their statutory records. As finished goods were found in excess, therefore, it was alleged that these goods are lying in their stocks for removal clandestinely without payment of duty. In these circumstances, a show cause notices were issued to the appellant for confiscation of the said goods and consequently imposing the redemption fine and penalty on the manufacturer appellants and penalties on the authorized representative. The show cau .....

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ubmits that during the course of investigation Shri Satyendra Singh has explained that we are recording the stocks in statutory records on the basis of average weight of the ingots manufactured in a day as physical weight is not possible. But at the time of clearance they are taking the actual weight. Therefore, the difference in excess stock found at the time of investigation is only due to this error and goods cannot be held liable for confiscation in the absence of any corroborative evidence. .....

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t at this stage. He further submits that there may be little variance can be found but in the case of M/s. Shivangi Estate Ltd. there is a difference of more than 25%. But appellant is recording the stock in their statutory records on average basis and on weighment is also done on average basis then in that case there should not be any variance. Therefore, he supported the impugned order and submitted that the goods are liable for confiscation. He also relied on the decision in the case of Usha .....

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of penalty. He also relied on the decision in the case of Rajasthan Spinning & Weaving Mills Vs. UOI-2009 (238) ELT 3 (SC) to say that the Apex Hon'ble High Court has also confirmed that to impose penalty under the section 11 AC mensrea is not required. He also relied on the decision in the case of Ganpati Rollings Pvt. Ltd. Vs. CCE New Delhi-2015 (315) ELT 91 (Tri-Del). To say that as the appellant has admitted the method of weighment and same has not been retracted, therefore, they ca .....

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total number of ingots found were 17,498 pieces. I find that when appellant is manufacturing two types of goods and while counting ingots it is not coming out from the facts of the case that how much of ingots are 3-4 inches and how much ingots are 3.5x4.5 inches. Therefore, the weighment method on average basis cannot be correct. Therefore, there may be a variation while taking the stock. In these circumstances, the method of counting the stock is not correct in the case of M/s. Jaideep Ispat & .....

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tock on average basis cannot be alleged against the appellant. 7. I find that in the case of M/s. Shivangi Estate Ltd. there is a stock found of 25% excess of the stock recorded in the statutory records and they are manufacturing only 1 type of MS Ingots and also recording stock in their statutory records on average basis. In that case the contention of the appellant is not acceptable that average base method is not correct as they themselves are relying on average basis method for recording the .....

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