TMI Blog2018 (1) TMI 634X X X X Extracts X X X X X X X X Extracts X X X X ..... d of excise duty of the goods allegedly clandestinely manufactured cleared during the period August and September 2009 I find that this allegation is based only on the mismatch of the production figures indicated in the profit register as against RG-1 register - the Revenue has not been able to conclusively prove that there was clandestine manufacture and clearances of the goods from the factory of the appellants - demand set aside. As regards, the evidences relied upon by the Ld. DR more specifically the statements of the Directors which is reproduced in the Show Cause Notice, I find that except for the statement of the Director which indicated that the goods were cleared clandestinely and cash basis further investigation had not taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l No. VAP-EXCUS-000-APP-567 568/2013-2014 dated 14.03.2014. 2. Heard both the sides and perused the records. 3. On perusal of the records, it transpires that the issue is regarding the following demands: a) A demand of ₹ 69579/- as demand of excise duty on shortage of Calcium Carbonate which is an input; b) demand of ₹ 2,96,041/- as demand of excise duty on the goods allegedly be clandestinely manufactured and cleared during the period August September 2009 calculated on the basis of difference between daily production register (profit register) and daily stock register (RG-1 statutory register); c) Demand of ₹ 1,67,117/- of excise duty on the goods allegedly removed clandestinely on the basis of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that the demand is otherwise unsustainable because the shortage of input is on account of natural loss and has been only to the extent of .36% for the entire period in question i.e. August 2009 to March 2010. As regards, the demand of duty on the goods based upon the consignment notes issued by the transporter it is the submission that the consignment notes were in respect of the goods cleared and received back and the second consignment note does not have any signature of the appellant or the responsible person. As regards, the confiscation of the finished goods found in excess, a mere non entry of the finished goods in statutory records do not render them liable for confiscation and the assessee is not liable to pay any redemption fine. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inputs are not manufactured item by the appellant; the said input is nothing but raw material which has been purchased by them from the manufacturers who had cleared the same on payment of duty. In absence of any evidence to show that the said raw material was manufactured by the appellant in his factory premises, there cannot be any demand of excise duty. The allegations in Show Cause Notice does not indicate that the Revenue is seeking to reverse the cenvat credit availed by the appellants on the raw material which was found short. In the absence of any evidence to indicate that the Calcium Carbonate is an input was manufactured by the appellant, the demand of excise duty is not sustainable. b) As regards the demand of excise duty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that this is the ratio of the decision of the Hon ble High Court of Gujarat in the case of Commissioner of Central Excise Vs Sakeen Alloys Pvt. Ltd. (supra). The said judgment has been followed by the principle bench of Delhi in the case of Davinder Sandhu Impex (supra) . Respectfully following the said ratio laid down by the Hon ble High Court of Gujarat it has to be held that the Revenue has not been able to conclusively prove that there was clandestine manufacture and clearances of the goods from the factory of the appellants. c) As regards, the evidences relied upon by the Ld. DR more specifically the statements of the Directors which is reproduced in the Show Cause Notice, I find that except for the statement of the Director w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is nothing on records to indicate that the appellant had intention to remove the said goods clandestinely. In the absence of any such evidence, in my view, the confiscation of the goods needs to be set aside and I do so. f) As regards, the penalties imposed on the main appellant, the penalty of ₹ 1,67,117/- under Section 11AC needs to be upheld on the findings as recorded herein above while other penalties have to be set aside and I do so. g) As regards, the penalty imposed on Sh. K. D. Agarwal, the other appellant, there is nothing on records to show that he needs to penalized under Rule 26 of the Central Excise Rule 2002. Accordingly, the penalty imposed on Sh. Agarwal is set aside. 8. Appeals are disposed of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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