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TMI Blog1997 (12) TMI 380X X X X Extracts X X X X X X X X Extracts X X X X ..... ory records. The following discrepancies were detected : (i) 32528.19 Kg. of Several dye intermediates were found in excess than recorded balance in statutory production register RG 1; (ii) 69,180 Kg. of Several S.O. Dyes were not accounted in RG 1; (iii) 33,421.1 Kg. of different input/raw-materials were found in excess than the recorded balance in Modvat credit account RG 23A Part I; (iv) 497.68 Kg. of J.Acid was not physically available although the said quantity was shown as in stock in RG 1; (v) 8000 Kg. of Para Cresidine was not physically available though shown as in stock in Modvat credit account RG 23A Part I; (vi) 5176.895 Kg. of K Acid was found short when compared with recorded balance in RG 23A Part I account; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se Rules with redemption fine of Rs. 1 lakh. Penalty of Rs. 1 lakh each was imposed on appellants V.J. Modi and M.R. Patel under Rule 209A Central Excise Rules. Hence the present appeals. 3. Ld. Counsel Shri V. Shridharan for the appellants made elaborate submissions on various aspects of the case, and the ld. DR Shri S.V. Singh made an equally detailed presentation of the Department s case. 4. Rival submissions have been considered. In the case of S.O. Dyes falling under Chapter 32 under confiscation, we find appellants have no case in respect of S.O. Dyes which were found packed in M.S. Drums but were found not entered in the RG 1 Register as these goods are fully finished and also packed ready for marketing. The duty demand thereon i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t will be reasonable on the facts and in the circumstances of the case to extend the benefit of doubt to the appellants, and in this view of the matter the confiscation of the quantity of S.O. Dyes found in bags is set aside with consequential relief to the appellants as per law. 5. In respect of dye intermediates the Commissioner s observation, we find, are well founded, and the appellants argument that since no RG 1 stage for dye intermediates has been prescribed the practice followed by them needs to be accepted, is not acceptable. The goods, it is noted, had been manufactured prior to 19-6-1996 and the claim that this (sic) were awaiting inspection by customers before accountal remains unsubstantiated by production of documents indica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns factually based were not given before the Commissioner, and it does not appear as though there was any lack of opportunity for them to do so. The Commissioner has observed, In fact, no explanation or any clarification has been given either by any deponents or by the company in their defence submissions for the said excess quantity of raw-material found during the search . The Commissioner s finding is well founded and substantiable. However, having regard to the nature of the offence, the fine in lieu of confiscation in respect of the same materials is reduced from Rs. 3 lakhs to Rs. 1 lakh. 7. Regarding shortages and consequential duty demand on `J Acid, Para Crosidine (sic), `K Acid and inputs/raw-material the appellants have appa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unting error of not reducing RG 23A Part I whenever `K Acid was sold. This cannot be considered at this stage when the appellants never raised it at all before the Commissioner and no reason given why they could not have done it. We note that applicants had also duly reversed the amount in Modvat account, and rightly so, in our view. 10. The appellants had before Commissioner accepted to pay/debit the duty on shortage of 1,28,431.920 Kg. and 43,889 Ltrs. of various inputs and in the present appeal have given elaborate item wise explanation and have ended up by submitting that the differences noticed are on account of technical/clerical mistakes. But fact remains that the shortages are unexplained satisfactorily and hence the duty demand ..... X X X X Extracts X X X X X X X X Extracts X X X X
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