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TMI Blog2017 (3) TMI 596X X X X Extracts X X X X X X X X Extracts X X X X ..... e Commissioner vide order dated 06/12/2012 granted common registration number for both the units. Prior to 09/11/2011 when the two units were having separate registration number, appellant was transferring inputs from unit I to unit II, on job work challans, for which records were being maintained. Unit I had also filed necessary declaration under Notification No. 214/2000. But it appears due to clerical mistake the said declaration was not in respect of all the inputs. The appellants are governed by the provisions of Insecticide Act, 1968 and are required to follow the procedure prescribed under the said Act. As required, the appellant declares the date of manufacture and expiry on each of the packing and are required to keep batch records for each product. The appellant is selling products in the consumer market in various packing ranging from 100 ml. to 25 kg. Each such packing size is required to have mandatory declaration with regard to the plant, disease, particularly regarding chemicals harmful to human beings and instructions concerning the decontamination. As the two units, although owned by the appellant, were treated as independent units under the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the storage of non-duty paid goods outside the registered factory premises. Mr. V.K. Verma, Production Manager of the appellant informed that Mr. S.S. Tripathi, Factory Manager was authorized for excise matters, was on leave. He stated that unit Il carries out job work for unit I. Unit Il does not sell any goods from its factory and therefore did not maintain any stock register or RG-I Register of finished goods and also did not issue any excise invoice. Mr. Verma also stated that the aforesaid excess stock kept in unit II, properly entered in RG-I Register of unit I, was kept in unit Il due to monsoon and non-availability of sufficient space in unit I. The authorised manager Mr. S.S. Tripathi who is also the Factory Manager stated that all the goods found unaccounted during stock verification were manufactured in their factory. The balances of these goods were not shown in the job register because the said goods could not be transferred physically due to heavy rains and lack of proper space in unit I. However, on papers/documents these goods were transferred due to clerical mistake. Further, all the goods found unaccounted in unit Il were manufactured and accounted in the RG-I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6/12/2012, granting common registration number. Further, it is admitted fact that the goods were found lying inside the factory-unit II and no attempt was being made for their removal. Certain goods were transferred from unit 1 to unit II for repacking in small packs but the job work challan had not been issued. No products were manufactured independent by unit II on their own account and it never used to sell any final product. The redemption fine imposed is both bad and highly excessive under the facts. The goods seized are not liable to confiscation as the same were lying inside the factory and there was no instance of attempted removal found by Revenue. 7. The learned Commissioner (Appeals) framed the following issues: -- i) Whether the amount of duty demanded and confirmed on quantity of finished goods found short in unit I is correct or not? ii) Whether goods recovered from factory premises of unit II without payment of duty are clandestinely manufactured and stored without making entry in RG-I Register? iii) Whether redemption fine is proper or not? And iv) Whether penalties are correctly imposed? The learned Commissioner observed that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by them. The production is entered in job work register. But in the job work register their balance was not reflected as finished goods were not physically transferred back to unit I, but the transfer was documented. In response to the next question as to why it happened so, it was stated that due to excessive rains and due to shortage of space in unit I, finished goods could not be transferred from unit II to unit I and due to clerical mistake the physical transfer was shown. Upon noticing this anomaly about 20 ton of goods had been physically transferred, but about 40 ton of goods remained in unit II. Further, in response to question No.4 as to why the goods were not transferred physically along with the job work challan, it was stated that this anomaly was not in his knowledge and has happened due to clerical mistake and circumstances leading to transfer being shown on the job work challan from unit II to unit I but physical transfer did not take place. Such mistakes have not taken place in the past. It is corroborated also by the statement of Mr. V.K. Verma, Production Manager. Reliance is also placed on the CBEC Excise Manual of Supplementary Instructions, 2005 wherein in C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e having common labour, common income Tax assessment orders, single Sales Tax registration. I also find that manufacturing process of both the units are interdependent and interlinked. ORDER In view of above findings, I hereby order that single registration under Central Excise rules is admissible to Unit-I & Unit-II of M/s India Pesticides Ltd., Lucknow and same should be granted forthwith. 9. The learned counsel further relies on the ruling of this Tribunal by Division Bench in GOM Industries Ltd. vs CCE, reported at 2000 (124) E.L.T. 843 wherein the goods were found stored outside the factory premises in a vacant plot adjacent to the factory an some goods were found short as compared to recorded stock the goods were seized on the belief that they were liable to confiscation. It was explained by the assessee that the goods were stored due to shortage of space and due to income tax raid on the previous day and the drums containing the goods occupied much space and there was no intention to evade payment of duty, as the goods stored outside were duly recorded in the statutory records. It was held that such violation cannot be treated as serious to invite mandatory penalty under ..... X X X X Extracts X X X X X X X X Extracts X X X X
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