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2016 (9) TMI 937 - CESTAT ALLAHABAD

2016 (9) TMI 937 - CESTAT ALLAHABAD - TMI - Demand and imposition of penalty - excess stock of molasses found in the storage tanks, unaccounted in the statutory records - clandestine removal of molasses - regular statement of MF-1 submitted by the parties to the State Excise Department - Held that:- the variation found in the stock of molasses on 14/07/98 upon inspection by the Central Excise authority is a normal variation and no adverse inference is called for. Further, I take notice of the fa .....

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the pendency of the appeals with the refund payable to the appellant. Accordingly, I direct the adjudicating authority to refund the amount adjusted, being in the nature of pre-deposit as the same have been adjusted out of refundable amount during pendency of the appeal, with interest as per Rules. - APPEAL No. E/55808 & 55816/2014-EX[SM] - Final Order No. 70753-70754/2016 - Dated:- 10-8-2016 - Mr. Anil Choudhary, Member (Judicial) Shri Dushyant Kumar, Consultant for Appellant Shri Pawan Kumar S .....

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isable products namely V.P. Sugar and Molasses. The stock of Molasses was found tallying with the recorded book stock by tank to the effect that against recorded balance of molasses on 37,660.6qtl, the quantity estimated by the Central Excise Authority by resorting to dip method was 43,582.7qtl. Accordingly, an appropriate difference of 5,922.10qtl, was worked out. It is further contended in SCN dated 27/07/98 that the excess quantity, so found valued at ₹ 8,41,023/-. Further, at the time .....

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rs including the foam factor. The appellant was required to show cause as to why not the quantity of 5922.1qtls, Molasses found in excess should not be confiscated under Rule 173-Q of Central Excise Rules, 1944 and further why not penalty be imposed as it appeared that the said excess stock of Molasses was kept in the steel tanks without being accounted in the daily stock account, namely, RG 1 register. 3. Subsequently, when the recorded stock of molasses was completely sold towards the end of t .....

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o intimated to the revenue under written communication/letter dated 12/12/98. It is not in dispute that this quantity of 961qtls, have been subsequently cleared on payment of Central Excise duty. 4. Subsequently, there was another inspection in the factory of the appellant on 10/05/99 when the stock records are checked and in the stock of molasses and excess quantity of 43.93qtls was worked out by reading to the dip method. The said alleged excess stock was seized and was handed over to Shri R.K .....

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urther proposal to impose penalty. 5. SCN dated 27/07/98 was adjudicated on contest and the alleged excess quantity of 5922.1qtl was held liable to confiscation with the option to redeem on payment of redemption fine of ₹ 50,000/-. Further, personal penalty of ₹ 5000/- was imposed on the assessee. Further, observing that in case of molasses redeem by the appellant, they will be liable to pay appropriate duty on clearance vide Order-in-Original dated 19/08/99. 6. The other show cause .....

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peals, together rejecting the appeals observing that on two occasions. The revenue authority found excess stock of molasses in the storage tanks, unaccounted in the statutory records. It is also observed that it is well known fact that clearance of molasses is physically supervised by the State Excise authorities and there is regular statement of MF-1submitted by the parties to the State Excise Department and such statements are verified by the State Excise authorities. The appellant have not pr .....

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ing aggrieved the appellant is in appeal before this Tribunal. The learned Counsel for the appellant urges that it is in established preposition and also accepted in several Rulings by this Tribunal and Higher Courts that due to foam factor, temperature both ambient and inside the tank where the molasses are stored, except the presence of foam, in that storage tanks of molasses. It is further urged that on the date of inspection 14/07/98, the variation found was about 13%. This Tribunal in sever .....

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of molasses without the permission of the appropriate authority. It is further urged that when the State Excise authority who monitor the stock of molasses, production, and dispatch etc. on a regular basis have accepted the excess quantity at 961qtl, the same cannot be rejected and as such the whole case of Central Excise authority is misconceived and accordingly, praying for setting aside the impugned orders. On the previous occasion when this matter was heard on 14/03/2016, this Tribunal has d .....

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