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TMI Blog2003 (8) TMI 328X X X X Extracts X X X X X X X X Extracts X X X X ..... officers on 10-12-98, who conducted various checks and verifications. The book balance in RG-23A Part-I in respect of the inputs was shown as 85.192180 M.T., whereas on physical verification of the inputs, the same were found to the extent of 57.700 M.T. As such the visiting officers noticed the shortage of the 27.492180 M.T. in respect of the plastic granules. Further in respect of the quantity of 57.700 M.T. of granules, quantity of 45.675 M.T. was not found in originally packed condition and as such the same was detained by the officers. Further original duty paying documents in respect of two M.T. of granules was also not found to be tallying. Accordingly the quantity of shortage was raised by another two M.T. 3. During the course of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.675 of granules found not in the original packed condition. (ii) Rs. 1,64.351/- in respect of 29.492 MT of granules allegedly found short, (iii) Rs. 3,28,930/- in respect of 17.916 MT of rejected materials received back by the appellant from customers for which Modvat credit was taken by it. 5. The show cause notice was taken up for adjudication by the Commissioner of Central Excise, Calcutta, when the appellant raised various contentions before him. The Commissioner vide his impugned order confirmed the demand of duty of Rs. 8,42,093.00 and also imposed penalty of identical amount under the provisions of Rule 57-I(4) of Central Excise Rules, 1944, along with confirmation of interest at the appropriate rate in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 001, dt. 16-1-2001 has held that mixing and blending of various grades of granules has undertaken by the manufacturers for the purposes of manufacture of a variety of the final product. The above conclusion was arrived at by the Tribunal after taking note of the letter written by the M/s. Reliance Industries Ltd. who were the primary manufacturer of the granules as also by the letter written by Indian Petro-Chemicals Corpn. Ltd. and Gas Authority of India Ltd. In these circumstances submits the ld. Adv. that there was no justification for denying the benefit on the ground that the inputs were not found to be in the original packing at the time of the visit of the officers. 7. Countering the arguments Shri N.K. Mishra, ld. JDR appearing fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ased upon the appreciation of the evidences produced by the appellants in those cases in the shape of the certificates by the primary manufacturer of granules and other relevant materials. I also note that there is no evidence on record that the appellants have cleared the goods in original packings to outsiders and have replaced the same with the other material. In view of this, I am inclined to accept the ld. Adv. s submission that there was no justification for denial of Modvat credit of Rs. 4,09,405/- in respect of the said quantity of 45.675 M.T. of granules. I order accordingly. 9. Further demand of duty of Rs. 3,28,930/- has been confirmed by rejecting the Modvat credit in respect of 17.91652 M.T. of materials which was rejected an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cord. 11. Modvat credit of Rs. 1,03,758/- in respect of 11.5756 M.T. of granules has been disallowed on the ground that they were found short at the time of visit of the officers. Out of the said quantity the appellants have claimed that 9 M.T. of granules was sent by them to M/s. Sonal Poly-plast without making any entries to their Modvat records, inasmuch as the said clearance was on loan basis and the appellant was expecting to receive back the material shortly. Shri Khaitan submitted that the above transaction has taken place on the basis of the challan which was also produced before the officers at the time of their visit and as such there can be no mala fide on their part. The balance of 2.57566 M.T. allegedly found short was on acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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