TMI Blog2018 (3) TMI 182X X X X Extracts X X X X X X X X Extracts X X X X ..... R Per : V. Padmanabhan The present appeals have been filed against the Order-in-Original No. RPR/EXCUS/000/COM/03-04/2015 dated 29.01.2015 passed by the Commissioner, Customs Central Excise, Raipur. 2. The appellant is engaged in the manufacture of iron and steel products M.S. Ingot and TMT Bars falling under Chapter 72 of the Central Excise Tariff Act, 1985. The appellant manufactures M.S. Ingot out of sponge iron and further use such ingots in rolling mill to manufacture TMT Bars with brand Buland . In addition, they are also engaged in receiving M.S. Ingots from SAIL to convert the same into TMT bars with brand SAIL . 3. The impugned order is the culmination of two different investigations undertaken for different periods. The impugned order has disposed of show cause notices dated 28.03.2013 as well as 30.06.2014. 4. During the period 05.06.2012 to 12.06.2012, Central Excise Officers visited the appellant s factory and carried out a thorough verification of the stock of inputs as well as finished goods in the factory of the appellant. During this period, the production and clearances in the factory continued but were thoroughly supervised by the Central Excise O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oon thereafter. However, he submitted that department has alleged a huge shortage of 9076.766 MT, even though for the period 05.06.2012 to 11.06.2012, the entire clearance activities were under the supervision and control of the departmental officers. He submitted that the conclusion of the adjudicating authority about the shortage is totally contrary to the panchnama dated 05.06.2012. Further, he also submitted that the stock verification was also not conducted on the basis of actual weighment but on the basis of estimates. (ii) With reference to show cause notice dated 30.06.2014, he submitted that the stock shortage ascertained during verification has been explained by the Director in his various statements as arising out of high burning loss. It is his submission that burning loss varies from 15% to 20% in respect of M.S. Ingot whereas in respect of TMT bars which is 3% to 5%. The huge shortage detected has been explained by the Director as accumulated burning loss. (iii) Simply on account of shortage of various goods, it cannot be alleged that such goods have been clandestinely cleared. The department has not carried out any corroborative investigations on aspects such a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... losses the physical stock may not match with the book stock. Such averment has been made by Sh. Gurpreet Singh Chandok, Director in his various statements. It is further claimed that the burning losses are higher in respect of manufacture of ingot even in the range of 15% to 20%. Burning loss invariably happens but we note that such a serious claim by the Director was not further investigated by the Revenue authorities. Even in the impugned order the same has not been discussed by the adjudicating authority. 13. Only a small demand of ₹ 2.9 lakh is based on certain details found in a letter pad recovered from the factory during the search in March, 2013. Even in respect of this piece of documentary evidence, no further investigation has been undertaken by the Revenue. It is pertinent to record that details of the buyers in such cases were found in the letter paid which could have been investigated but the same has not been done. 14. It is clearly well settled that allegation of clandestine removal of finished goods cannot be sustained only on the basis of mere shortage. In this regard, we reproduce below the observation of the Punjab Haryana High Court in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pal [2009 (234) ELT 457 (Tri. All)] and has rightly concluded that mere shortages detected at the time of visit of the officers cannot ipso facto lead to the allegations and findings of clandestine removal. 7. No illegality of perversity could be pointed out in the aforesaid findings of fact recorded by the Commissioner (Appeals) as well as the Tribunal which may warrant interference by this Court. Accordingly, no substantial question of law arises in this appeal . 15. In the case of Continental Cement Company vs. Union of India - 2014 (309) ELT 411 (All.) the Hon ble Allahabad High Court has held that clandestine removal is a serious charge which is required to be proved by Revenue by tangible and sufficient evidence. The Hon ble High Court observed as follows- 12. Further, unless there is clinching evidence of the nature of purchase of raw materials, use of electricity, sale of final products, clandestine removals, the mode and flow back of funds, demands cannot be confirmed solely on the basis of presumptions and assumptions. Clandestine removal is a serious charge against the manufacturer, which is required to be discharged by the Revenue by production of suffic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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