Customs, Excise and Gold Tribunal - Delhi
Sanket Food Product Pvt. Ltd. And Shri ... vs Cce on 22 July, 2005
ORDER
S.S. Kang, Vice President
1. Appellant filed this appeal against the adjudication under passed byy the Commissioner of Central Excise.
2. The brief facts of the case are that the appellants are engaged in the manufacture of Pan Masala. On 8.03.2002, the factory premises of appellants were searched and premises of M/s. S.R. Marketing and M/s. Rathi Enterprises were also searched. From the premises of M/s. S.R. Marketing, 700 packets of Pan Masala valued at Rs. 44, 100.00 were seized on the ground that the Pan masala was cleared by the appellants without payment of duty. During verification, it was also found that printed laminated rolls weighing 7459.592 Kgs were found in excess than the quantity shown in RG-23A Part I. The excess printed laminated rolls were also seized.
3. Show cause notice was issued for demanding duty in respect of the Pan Masala seized from M/s S.R. Marketing and for confiscation of Printed laminated rolls. The Adjudicating authority dropped the demand in respect of the Pan Masala seized from the premises of M/s S.R. Marketing. However, confiscated printed laminated rolls found in excess to the recorded balance and allowed the same on payment of redemption fine of Rs. 2,50,000/- and penalty of Rs. 50,000/- was imposed on the Firm and penalty of Rs. 10,000/- was imposed on the Director.
4. The contention of the appellants is that the search was made at different placed but no excess of final product was found in the factory. The contention is that the demand in respect of the Pan Masala seized from the premises of M/s. S.R. Marketing was dropped on the ground that the goods were cleared on payment of duty. In respect of shortage of printed laminated rolls, the contention of the appellants is that this was done on the basis of average weight of each roll as found on 8.3.2002. The contention is that as per the record, the total stocks of printed laminated rolls as available on 8.3.2002 was 36465.353 Kgs. Where is, as per the Revenue, stock available was of 36711.85 Kgs. This figure is arrived on the basis of eye estimation. As per the appellants, the stock position is as under:
1. Opening stock of PLRs as on 01.04.2001 35256.000 Kg
2. Purchase during 1.4.2001 to date of stock taking i.e. 08.303.2002 32475.400 Kg.
3. Total 67761.400 Kg.
4. Qty. transferred to assessee's patparganj Unit during above period 3719.610 Kg.
5. PLR's consumed during 1.4.2001 to 8.3.2002 27546.437 Kg.
6. Stock of PLR's available on 8.3.2002 36465.353Kg
5. The contention is that on the Panchnama when the stock was calculated on eye estimation, the authorized signatory refused to sign the Panchnama and subsequently, due to the pressure of the Revenue, he signed the Panchnama. The appellants produced the copy of the Panchnama where it is mentioned that authorized signatory refused to sign the Panchnama.
6. The Contention is that as appellant explained the excess, therefore, there is no justification in confiscation of the Printed laminated rolls on the ground that these were found in excess. The appellants also relied upon the decision of the Tribunal in the case of C.C.E., Indore v. Ajmer Food Industries, reported in 2004 (60) RLT 297 (CESTAT-Del.) and submitted that input cannot be confiscated under Rule 173 Q of Central Excise Rules and present Rule 25 of Rules is similarly worded.
7. The contention of Revenue is that the excess was calculated in the presence of authorized signatory and appellants could not give any explanation regarding the excess. Therefore, the confiscation was rightly made.
8. In this case the factory premises of the dealer were searched by the Revenue authority. Certain amount of Pan masala was recovered from the dealer place and show cause notice was issued for demanding duty of that quantity on the ground that this was cleared without payment of duty. But on production of necessary evidence, the Adjudicating authority dropped the demand.
9. In respect of printed laminated rolls, the appellants gave all details reply stating therein-opening stock on 1.4.2001 and purchases made during the period 1.4.2001 to 8.3.2002. The appellants also gave the details of the quantity of printed laminated rolls which were transferred to the other Unit and also the quantity of Printed laminated rolls consumed during the period 1.4.2001 to 8.3.2002. These figures were produced by the appellants before the Adjudicating authority and adjudicating authority also taken note of these figures. The quantity mentioned was not disputed by the Revenue. The Revenue only confiscated the inputs on the ground that there was nothing on record to show that Printed laminated rolls were issued for production of the final product. I find that there is no discrepancies in the stock of final product or other raw material used in the manufacture of Pan masala and appellant explained the quantity in stock. Further, Tribunal in the case of Ajmer Food Industries (Supra) held that the inputs are not liable for confiscation under Rule 1173Q of Rules. The provisions under new rules i.e. Rule 25 as similar to provisions of Rule 173Q which provides confiscation of unaccounted excisable goods, which are manufactured.
Therefore, confiscation is not sustainable, hence set aside. The appeals are allowed.