Custom, Excise & Service Tax Tribunal
M/S. Bhartiya Tar Udyog vs Commissioner Of Central Excise on 31 March, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Excise Appeal No. 58137 & 58138 of 2013-EX [SM]
[Arising out of Order-In-Original No. 48 - 49/CE/D-II/2013 dated 19.03.2013 passed by Commissioner of Central Excise (Appeals), Delhi II ]
For approval and signature:
Honble Ms. Archana Wadhwa, Member (Judicial)
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Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
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Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
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Whether Their Lordships wish to see the fair copy of the Order?
Seen
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Whether Order is to be circulated to the Departmental authorities?
Yes
M/s. Bhartiya Tar Udyog Appellants
Anurag Jain
Vs.
Commissioner of Central Excise, Respondent
Delhi II Appearance:
Shri V K Gupta, Advocate for the Appellants Shri M S Negi, AR for the Respondent Date of Hearing /decision: 31.03.2014 ORDER NO. FO/ 51446-51447 /2014- (SM) Per Archana Wadhwa:
The appellant is engaged in the manufacture of copper wire rods from the copper ingots. Their factory was visited by Central Excise officers on 10.1.11, when the physical stock verification was undertaken. As a result shortage of stock of the final product to the tune of 85.300 Kgs. of goods and shortages of raw materials to the extent of 10855 Kgs. of allegedly detected. The partner of the manufacturing unit in his on the spot statement admitted shortage and revealed that same has been cleared clandestinely and he is ready to deposit the amount in question.
2. On the above basis, proceedings were initiated against him by way of show cause notice which culminated into passing of order by adjudicating authority confirming the demand of Rs.,1,27,002/- along with confirmation of interest of 1380 and imposition of penalties upon both the appellants. The said order was upheld by Commissioner (Appeals) and hence the present appeal.
3. After appreciating the submissions made by both the sides, I find that Revenues entire case is based upon the alleged shortages detected ast the time of visit of officers, read with statement of partner recorded on 10.1.11. However, it is seen that on 11.1.11, the said partner addressed a letter to their Assistant Commissioner, Anti-Evasion, the concerned officer, making reference to the visit of officers in his factory and clarifying that though he had given the explanation that short found goods were lying red hot in the furnace but the officers did not make any verification of the same. Accordingly, it was explained by the appellant that there was no shortages inasmuch as the goods were lying in the furnace area.
4. From the records, I find that there is no evidence to show that furnace area was also checked to verify the fact that as to whether any final product was lying there or not. It is otherwise also seen that to weigh such heavy stock of raw material as also the final product, the inventory are required to be made and that such heavy stock cannot be weighed. There is no evidence on record to show as to who such weighment was undertaken by the visiting officers.
5. I also find that there is no evidence of clandestine removal except the alleged shortages, which are also doubted. No evidence of clandestine removal, the confirmation of demand of duty based upon the alleged doubtful shortages read with statement of authorised person recorded at the time of search of the factory itself, cannot be considered to be sufficient evidence so as to lead to inevitable conclusion of clandestine removal. Tribunal in the case of Commissioner of Central Excise, Meerut I vs. Silvertone Papers Ltd. [2013 (287) ELT 478 (Tri-Del)] has considered the entire case law on the spot and has held that the alleged shortages read with statement of one of authorised representative, cannot be held to be sufficient evidence so as to uphold the finding of clandestine removal. Revenue, after recording the statement, w3hich stand rejected immediately on the next date, has not bothered to make further investigation and to record statement of persons who are actually concerned with the manufacture of goods as also of the clearance and marketing of the same. No identity of the buyers of the raw material etc. stand identified. As such, by extending the benefit of doubt to the appellant, I set aside the impugned order and allow both the appeals with consequential relief to the appellant.
(Dictated & pronounced in the open Court )
( Archana Wadhwa ) Member(Judicial)
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