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TMI Blog1995 (3) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 giving them the option to redeem them on payment of fine in lieu of confiscation of Rs. 44,605. Duty was to be paid at the time of clearance. Penalty of Rs. 50,000/- was imposed by him under Rules 52A and 173Q of Central Excise Rules, 1944. In addition, duty of Rs. 35,311.94 was demanded on certain quantities of knifing putty, varnish, insulating varnish and primer found short in their stocks. As the goods Enamels, Primer and V.C. lacquers had been released on provisional basis, the amount adjudged as redemption fine was ordered to be appropriated against the Bank guarantee. 2. Shri V. Sridharan, learned counsel for the appellants submitted that the allegations of shortage and excess of the different items in question have been raised a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which tallied with the recorded balance of R.M. Paints as shown in RG 1. It was, therefore, submitted as against the quantity of 55,729.500 litres of Enamels, 50,988.350 litres of R.M. Paints had been entered in their RG 1 which had also been conceded by the department. Even otherwise, these goods found in stock and alleged to have not been accounted for in their statutory record as Enamels discharged the duty liability involved as and when they were cleared from their factory. Likewise the excess items N.C. Lacquer (533 litres) was also cleared on payment of duty at the time of its removal. 3. Shri Sridharan then pointed out that duty of Rs. 35,311.94 on 2051 knifing putty 10 litres of varnish, 30 litres of insulating varnish and 2243.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion that the fine amount may be suitably reduced as also the penalty amount of Rs. 50,000/-. 4. Replying to the arguments advanced by Shri Sridharan, Shri K.N. Gupta, learned Senior Departmental Representative stated that the shortage and excess in some of the items have been accepted by the appellants. It only indicates that something was fishy in their maintenance of stocks and of their records. The Collector has considered thoroughly whatever was stated by them in their defence. Shri Gupta cited the Tribunal decision in Goodyear India Limited v. Collector of Central Excise, reported in 1990 (48) E.L.T. 394. The shortages noticed in that case were held to be due to clandestine removal of goods and excess due to non-accountal of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el. If the two products Enamel and Paints are not the same as has been held by the Collector there should have been a shortage of R.M. Paints which figured in the Register but which were physically present only as enamels. No such shortage was made out in the stocktaking report. Their method of showing the enamels as R.M. Paints had been mentioned by their Director. Shri V.K. Singhal whose statement recorded on 19-1-1989 contained the following :- In addition to above-mentioned stock of excisable goods there had been below-mentioned stock of sipolac synthetic enamel, Dhanush synthetic enamel, sipolite synthetic enamel, sipolite furniture enamel, sipolite Hammer Tex finishes which we have entered in the name of R.M. Paint (32/32.08/3208.9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on 19-1-1989 the balance quantity of primer as per R.G. 1 Register was 2,243.200 litres while the stock physically available was shown as 2,491.700. The difference was shown as +248.500 litres. In other words, the actual excess was 248.500 while the quantity actually in stock was 2,491.700 litres. This latter quantity has been wrongly taken as the excess quantity in the order. To complete the mistake, the quantity 2,243.200 which was recorded in R.G. 1 Register has been shown as the shortage ignoring the stock of 2,491.700 litres which was physically available. Such findings are inconsistent with the list prepared by the departmental officers after checking the stocks on 19-1-1989. Thus the actual excess, which has been admitted by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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