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TMI Blog2016 (9) TMI 730X X X X Extracts X X X X X X X X Extracts X X X X ..... epartment. An audit took place in the premises of M/s Sadhshiv Structural P. Ltd. during the financial year 2008 and it was observed that during the period of 2006-2007 and 2007-2008 the respondents procured inputs and manufactured ERW Pipes. It was found that as per input ratio there was balance quantity of 257.340 MT and 108.425 MT inputs were not with the respondent so it was presumed that it has been shown by the respondent as processing loss. It was also presumed that as there is no heating process involved, therefore, there was not any burning loss and alleged that the said quantity has been cleared by the respondent clandestinely without payment of duty. In reply to the audit objection by the Range officers and it was explained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat during the course of audit no such waste & scrap was fund in the factory and no such waste and scrap was recovered in their records, therefore, it is a clear cut case of clandestine removal. Accordingly, the respondent no. 1 is liable to pay duty along with interest and is to be penalized. He submits that the respondent no.2 never received the goods and only received the invoice, therefore, they are not entitled to avail cenvat credit. Consequently, they are liable to pay duty along with interest and are to be penalized. He also relied in the case of N.P. Agro (I) Industrial Ltd. reported in 2015 (315) ELT 484 (Allahabad), Sita Cement Ltd. reported in 2003 (153) ELT 204 (Tri. Kolkata) and Gulabchand Silk Mills Pvt. Ltd. reported in 2005 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent no.1 shown as burning loss to the tune of 5.62% to 5.68% respectively during the period 2006-2007 to 2007-2008 and no statement was recorded of any person to explain such shortage. No effort was made to examine whether during the course of manufacture, any waste and scrap arose or not"? Further, when the respondent no. 1 explained that they have cleared waste and scrap on payment of duty, no effort was made to ascertain the truthfulness on the fact. No effort was made to visit the premises of respondent no. 2 to assertion that the respondent no. 2 has received waste and scrap or not. The whole investigation/ audit remained faulty and the show cause notices were issued to both the respondents in the wake to allege the respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onerate intercepted three trucks and the driver of the said trucks produced duplicate copies of three challans and invoices showed the PLA debit entry no. giving the impression that the duty has been paid by the manufacture through PLA but during the cross examination it was found that no duty was paid by the assessee. Further, relying in the case of N.P. Agro (Supra), I find that it is a case of seized goods during the course of investigation and on seized goods no explanation was given by the assesse. The said case laws are not applicable to the facts of the case in hand. As in this case neither the goods were seized nor goods were intercepted. It is a case of audit and on the basis of audit it was presumed that respondent no. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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