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TMI Blog1996 (2) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... EB-4 registers. The finished stock (including the finished production of 25-9-1988) was checked with the physically available stock in the Bonded Store Rooms by counting the number of cartons. As there was no uniformity of weight in the packages and as the stock in balance was heavy, an average weight per package was taken on the basis of counting. It is stated in the show cause notice that this formula was agreed to by the assessee. However, this aspect of the matter is strongly disputed and the assessee in their reply have contended that they have never agreed for any basis for the purpose of counting. It is stated in the show cause notice that the factory expressed its inability to get the total weight of the stock in balance checked in view of the heavy stock in hand and in view of the shortage of man power on their part, as also involvement of lot of scriptory work in arriving at the weight of the packages in balance. It was found that stocks had been duly packed in cartons but godownwise stock cards were not available with the unit. The stocks were counted on three occasions. On the first occasion it was found 9 cartons of nylon filament yarn weighting 172.8 kgs in excess; o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d at is arbitrary figure. They have not agreed for any formula as alleged in the show cause notice. They have also stated that they were not given an calculation sheets which they had demanded by their letter dated 28-9-1988. They had brought out various defences in their reply to counter the allegations of clandestine removal. The reply is of 11 pages. The Learned Collector has given a brief finding and has not given any finding on these issues raised by the appellants in reply to the show cause notice. The Learned Collector has held in para 9 that : It is understood that when the counting was done three times as submitted by the party in their defence reply dated 25-6-1989 and difference came out, why they did not try to reconcile the discrepancy by again recounting their stock. Therefore, the allegations made by the Central Excise Department, that 52 cartons were found short which had been alleged to have been removed clandestinely is proved. Moreover the contention of the party that they did not agree to average weight taken during physical verification is not acceptable when their authorised signatory had signed the verification chart showing the discrepancy in the stock an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustries Ltd. v. Collector of Central Excise - [1984 (15) E.L.T. 451] 3. Oudh Sugar Mills Ltd. v. Union of India - [1978 (2) ELT. (J 172)] 4. Ashwin Vanaspati Industries Pvt. Ltd. v. Collector of Central Excise - [1992 (59) E.L.T. 175]. 6. The Learned Counsel submitted that they had taken stock for subsequent years and during each year they had found 52 cartons in excess. Such calculation sheets were produced to the department and the copies have been annexed along with the appeal memo. It is her contention that despite these excess of 52 cartons found being brought to the notice of the department yet the Learned Collector has not considered these plea and not referred to it in his finding. 7. The Learned DR submitted that the appellants had been supplied with the calculation sheet along with a covering letter, by the Deputy Collector on 26-5-1989, much after the date of issue of show cause notice. On this point the Learned Advocate submitted that what was given was a consolidated stock figure but not the calculation sheet and work sheet on which the company representative had applied his signature on the sheets. 8. The Learned DR further submitted that the physical cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the heavy stock in hand and in view of the shortage of manpower on their part, therefore, they adopted some short cut basis for taking the verification of the stock. This aspect has been contested very vehemently by the assessee in their reply to the show cause notice stating that they never agreed for any short method of taking weighting of the stock and they have given their own detailed work out on their average basis, and contested the basis on which the department has proceeded. They have stated that if their procedure is adopted it would give a correct calculation and the stocks would be to an extent of 4,10,936 kgs. This would result in stocks being in order. This is a very crucial point raised by the assessee, which was bond to have been looked into by the Learned Collector. However, I notice that the Learned Collector has not dealt with this point also. The assessee has also raised several pleas in their reply at pages 3 to pages 11 of the reply to the show cause notice. It is noticed that none of these contentions has been adverted to by the Learned Collector. The finding arrived at by the Learned Collector is arbitrary and without due application of mind. In cases wher ..... X X X X Extracts X X X X X X X X Extracts X X X X
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