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TMI Blog1999 (9) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... s found to the tune of 39.157 M.T. Thus there was a shortage of 33.03 MT of casting and cast articles of steel on which the duty has been confirmed by the adjudicating authority. 3. Arguing on this aspect, Shri B.N. Chattapadhaya, learned Constt. submitted that the appellants factory was visited on 23-12-92. Thereafter, 25th, 26th and 27th December, 1992 were holidays being Christmas Day, Saturday and Sunday. On the first available working date that is 28th December, 1992, they wrote a letter to the Supdt. of Central Excise who came to their factory giving details of stock lying at their factory at various stages along with the name of the persons for whom the goods have been manufactured by them. Drawing attention to the said letter which was received in the Office of the Supdt. on 29th Dec. 1992, he submitted that it was clarified in the said letter that they were making entries in their RG-1 records as soon as the goods come out of the moulds without fettling/heat treatment, gas cutting etc. For undertaking the above operations, the goods are removed first to machine shop, fettling shop, gas cutting yard or in the heat treatment furnace. This pratice is being followed by them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... log book immediately after the goods are cast. Thereafter the same are subjected to dimensional check and chemical test to see whether the same are in accordance with the specification. If the goods are found to be defective chemically or dimensionally, the same are scrapped and are taken for recycling. As such the entries in log book and those made in RG-1 are bound to differ at all times and demand of duty cannot be confirmed on comparison of the same. He further argued that the onus to prove the charge of clandestine removal lies heavily upon the Department and is required to be discharged by them on production of substantial evidence. There is no other evidence corroborating the evidence of cladenstine removal of the goods. He submitted that an explanation was immediately tendered by the appellants with an invitation to the Department to re-do the verification. No steps were taken by the Department to do so. As such, mere shortages by themselves cannot prove the charge of clandestine removal. In support of his above submissions, he referred to the Tribunal s decision in the case of Automobile Products of India Ltd. v. CCE, Aurangabad [1995 (75) E.L.T. 714 (Tribunal) = 1993 (46 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that the entries made in log book clearly represented the manufacture and removal of the final product which was reflected in the statutory record maintained by the appellants. In these circumstances, there was no question of production of any further evidence by the Department to prove clandestine removal of the final product. 7. He referred to the Tribunal s decision in the case of H R Johnson (I) Ltd. v. C.C.E., Indore [1994 (71) E.L.T. 589 (T)] wherein it was held that the stock taking done in presence of the manufacturer s representative and stock verification report signed by him has been accepted in the absence of satisfactorily explanation by the appellant. Filing of a protest letter after stock verification was held to be a post-seizure letter and was rightly discarded by the adjudicating authority as an afterthought. Reference was also made by Shri Kennedy to another decision of the Tribunal in the case of Indian Chrome Metals (P) Ltd. v. C.C.E., BBSR [1994 (73) E.L.T. 613 (T)] wherein Explanation tendered at a later stage of stock taking leading to shortages was not found acceptable and the demand in terms of Rule 223A of C. Ex. Rules, 1944 was confirmed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e veracity of their statement, the truth would have come out. What prevented the officer to take the said action is not understandable. Further to reject the said letter as an afterthought done by the adjudicating authority is not appreciated. Can a letter written after a period of five days with intervening three holidays be said to be an afterthought. As rightly contested by the ld. Constt. that mere shortage by themselves cannot lead to the inevitable conclusion of the goods having been removed clandestinely when there is sufficient explanation from the appellants and that too immediately after the detection of the shortages. The various precedent decisions have laid down the law that allegations of clandestine removal are serious allegation and must proceed on tangible and positive strong evidence. The inference of clandestine removal cannot be drawn on the basis of conjectures and surmises. 9. Similarly, the contentions raised by the appellants that a part of the goods which was entered in RG 1 register was sent to the job worker u/r 57F(2) under the coverage of challan. No doubt that the goods were not debited in RG 1 register when the same were sent to the job worker but t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the log books and not recorded as manufacture. It is also seen that Shri Pravesh Kamal Dutta, the authorised representative of the appellants in his statement dated 1-3-93 given to the Supdt. of C. Ex. in course of inquiry has deposed that they had been recording the actual production of casting and cast articles of steel in the said two log books. There is no retraction of the said statement. The appellants have also not shown the by production of any documentary evidence that the goods shown as manufactured in the said log books were being sent for remelting in case they are found defective. This contention of the appellants, in any case, does not stand on the face of the fact that weight of the goods entered in the said log books tallies to the full extent to the weight of the goods entered in RG 1 register (wherever they have been recorded in both the books) reflecting thereby that the entries in the said log books have been made after complete finish of the goods and not at the stage when the castings come out of the moulds. All these facts clearly establish that the entries made in the said log books but not reflected in RG-1 register have been manufactured by the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X
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