TMI Blog2016 (6) TMI 1014X X X X Extracts X X X X X X X X Extracts X X X X ..... standards of ICAI and Income Tax are different from the criteria for recording stocks under Central Excise law. - Revenue failed to prove its case - Demand set aside - Decided in favor of assessee. - Appeal No. E/737/05 - A/87830/16/EB - Dated:- 12-5-2016 - Shri M.V. Ravindran, Member ( Judicial ) And Shri Raju, Member ( Technical ) Shri H.G. Dharmadhikari, Advocate with Shri D.A. Bhalerao, Advocate for the Appellant Shri S.V. Nair, Supdt. (AR) for the Respondent ORDER Per Raju The appellants, M/s Lubrizol India Pvt. Ltd., are manufacturer of certain chemicals. During the audit conducted by Revenue, it was noticed that the figures of stock reported in their financial accounts (3 CD Returns) filed with the Income Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2,500 MT WIP 272 MT RG-1 2,097 MT Rejected 96 MT Scrapped 37 MT Excess 403 MT Total 403 MT Thus, the above figures explain that the rejected quantity and scrap quantity are part of the excess inventory in comparison with RG-1 stock and the said has been presumed as shortages by the Department and wrongly demanded the duty without establishing the removal of go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied on Rule 3 to assert that appellants were required to maintain proper daily stock account of the goods manufactured by them. 4. We have gone through the rival submissions. We find that in the instant case while there is allegation of clandestine clearance on the basis of shortages found, no stock verification has been done nor any evidence of clandestine clearance has been recorded. The entire case of Revenue is based on the mismatch between 3CD returns submitted by the Income Tax authorities and the RG-1 register maintained by the appellant under the Central Excise law. The Tribunal In the case of Shree Precoated Steel (supra) has observed as follows: - The form 3CD which is required to be filed to the Income-tax Department i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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