Custom, Excise & Service Tax Tribunal
M/S Sikka Papers Ltd vs Cce, Meerut-I on 12 May, 2008
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI PRINCIPAL BENCH - COURT NO. 1 Excise Appeal No. 1815 of 2006 (Arising out of Order-in-Appeal No. 244/CE/MRT-I/2005 dated 06.12.2005 passed by the Commissioner of Central Excise (Appeals), Meerut). DATE OF HEARING : 12.05.2008 DATE OF DECISION : 12.05.2008 FOR APPROVAL AND SIGNATURE : HONBLE MR. JUSTICE S.N. JHA, PRESIDENT 1. Whether Press Reporters may be allowed to see the order for publication as per Rule 27 of the CESTAT (Procedure)Rules, 1982 ?. 2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not ? 3. Whether their Lordships wish to see the fair copy of the Order ? 4. Whether Order is to be circulated to the Departmental Authorities? M/s Sikka Papers Ltd. . Appellants (Rep. by Sh. A. Jaju, Adv.) VERSUS CCE, Meerut-I . Respondent
(Rep by Mrs. A. Pandey, Jt. CDR) CORAM : HONBLE MR. JUSTICE S.N. JHA, PRESIDENT ORDER NO.______________________________ PER JUSTICE S.N. JHA :
This appeal by the assessee is directed against the order-in-appeal of the Commissioner of Central Excise, Meerut-I, dated 06.12.2005 upholding the order-in-original of the Assistant Commissioner, Muzaffarnagar, dated 29.09.2004. By the said order the Assistant Commissioner confiscated the goods in question viz. 16.037 MTs of Writing & Printing Paper with option to the appellant to redeem the goods on payment of redemption fine of Rs. 10,000/-, and imposed penalty of Rs. 5,000/- in terms of Rule 25 of the Central Excise Rules, 2002.
2. The appellant is engaged in the manufacture of paper products falling under sub-heading nos. 4801.00, 4804.90 & 4802.90 of the Central Excise Tariff Act, 1985. On 24.04.2003, the factory premises of the appellants were searched by the officials of the Preventive Wing of the Central Excise and excess stock of Writing & Printing Paper to the extent of 16.037 MTs and shortage of News Print Paper to the extent of 16.452 MTs was discovered. Show cause notice was issued followed by the adjudication proceedings resulting in the aforementioned order dated 29.09.2004.
3. It was submitted on behalf of the appellant that while confiscating the goods with option of redemption fine and imposing penalty, as aforesaid, the Asstt. Commissioner dropped the duty demand of Rs. 26,678/- on shortage of 16.452 MTs of News Print Paper. It was submitted that what is said to be excess stock of Writing & Printing Paper was the stock of News Print Paper, but due to mix up of goods by the labourers the alleged variation in the stock occurred. It was submitted that the mere fact that the excess was not reflected in the RG-I Register is not an adequate proof of attempt to remove the goods clandestinely. It was submitted that in the absence of any proof of mens rea as to clandestine removal of goods, action could not be taken against the appellant. It was pointed out that the Panchnama which is the basis of the impugned order does not bear the signature of excise representative of the appellant, and the same cannot be regarded as conclusive proof of the stock position. In support of the submissions, reliance was placed on Supreme Industries Ltd. Vs CESTAT, New Delhi, 2007 (214) ELT 187 (MP) and Citizen Extrusion (P) Ltd. Vs CCE, Surat-II, 2007 (220) ELT 818 (T-Ahmd.).
4. On behalf of the Revenue, attention was drawn to the findings of the Commissioner (Appeals) to the effect that the excess was admitted by the Excise Incharge and Authorized Signatory of the appellant, namely, Shri S.K. Srivastava, whose statement under Section 14 of the Central Excise Act was recorded on the spot. It was pointed out that the stock verification was made in the presence of the said representative and there is nothing on the record to suggest that the representative had any grievance as to the manner of the stock verification. The appellant, therefore, cannot make any grievance as to the methodology of the stock verification. With regard to the cases cited on behalf of the appellant, it was submitted that the facts of the instant case are different from those of cited cases and, therefore, are of no assistance to the appellants case.
5. After considering the rival submissions of the appellants counsel and the DR, I am of the view that the submissions advanced on behalf of the Revenue are well founded. It is not in dispute that when the factory premises was searched, and the stock was verified, Shri S.K. Srivastava, Excise Incharge and Authorized Signatory of the appellant was present. If he had any objection as to the manner or the methodology of stock verification, he should have made a grievance to that effect on the spot or at the earliest opportunity thereafter. In this view, the fact that the Panchnama does not bear the signature, cannot be a significant ground to reject the result of stock verification. It is true that the stock of Writing & Printing Paper found in excess and stock of News Print Paper found short was approximately the same but this does not help the case of the appellant. The fact that the stock found in excess or short was not shown in the RG-I Register, shows the intention of the appellant to clandestinely remove the goods. Excess or shortage of stock by itself may not necessarily reflect the mens rea of a person, but as is often said, the mens rea is a mental condition and the existence of mental condition can be gathered only by the offending circumstances.
6. The dispute is concluded by concurrent finding and the impugned order does not suffer from any error of law to justify inference by the Tribunal.
7. The appeal is devoid of any merit and it is accordingly dismissed.
(Dictated and pronounced in the open Court on the 12TH day of May, 2008) (JUSTICE S.N. JHA) PRESIDENT Golay