1999 (7) TMI 373

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..... sses, during process of man made fabrics, stock taking was conducted on 1-6-1990, and processing loss of 1,403.65 metres were observed in respect of loss fabrics. The loss worked out to 3.5% about on the total processing carried out during the period covered between last stock taking and present stock taking. Stock report is enclosed. Appellant was served with show cause notice dated 13-8-1990, calling upon to show cause as to why Rs. 19,167,65 should not be recovered from them on account of above shortage noticed at stock taking. Appellant replied it on 29-10-1990 with records and asked the Central Excise Range officers to be present in factory during the actual process to ascertain the shrinkage, which was not conceded. After perusal of r .....

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..... sufficient and satisfactory grounds to allow the appeal? I answer in the affirmative. 4. Perused the show cause notice, reply impugned order, Order- in-Original and documents produced, appeal memorandum and Rule 223A of Central Excise Rules and 1989 (44) E.L.T. 153 in the case of Amitabh Textile Mills Ltd. v. Collector of Central Excise - Stock Taking-Accounts of goods. Goods found deficient quantity alleged to be on account of natural loss-Deficiency beyond 2.5% not condonable when evidence in the form of statistical details about losses not produced. Rules 49 and 223A (Paras 11 12) in 1983 (14) E.L.T. 2095 (Bom.) = 1984 ECR 787 (Bombay) in the case of Jg. Vacuum Flasks Limited v. Union of India and others Bombay High Court has held th .....

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..... of loss due to natural causes in the course of processing as contended in reply to show cause notice, which was not positively responded. The Assistant Collector in the Order-in-Original has accepted the case of appellant in the alternative stand that shrinkage varies from fabrics to fabrics, and there is no uniform percentage fixed for shrinkage as standard, under Rule 223A of Excise Rule as percentage of shortage is 3.35%. As contended by appellant no reason is assigned in holding that shortage on account of natural causes upto 2% is within normal limit and condonable in the case of Industrial fabrics. He has observed no authority or rule is pointed out by the assessee for condoning higher percentage. There is no dispute for 3.35% perc .....

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