9911796707
TMI Blog2003 (9) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant Company and imposed penalties against the other Appellants as detailed therein. 2. The manufacturing premises of the Appellants No. 1 was visited on 19-3-99 by the Central Excise Officers. On checking of the stock of their finished excisable products as well as inputs used by them in the manufacture of finished products, excess stock of 3899.8 Kgs of HDPE fabric, 37739 cement bags and 1550 Kgs of wastage was detected and seized. On scrutiny of RG-1 and RG-23A Part I register, it was observed by the Officers that the production shown by the Appellants and recorded in the RG-1 register did not commensurate with and proportionate to the inputs/raw materials issued and that they had shown less production as against issuance of highe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one for the fertilizer/cement bags. The handling loss of the raw materials was not accounted for and the process loss was not taken into account by the Department while calculating the demand. They also claimed deduction of the thinner in the calculation of the duty. They, further, averred that subtraction of 7936 kgs of seized excisable goods, while calculating the duty had not been done and submitted one Chart of Production from August, 1997 to August, 2001 and claimed that the difference was only of 45024.54 Kgs which according to them was due to handling/process loss. The Adjudicating Authority, however, did not accept the version of the appellants and pass the impugned order. 3. The learned Advocate for the Appellants has reiterated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he benefit of the Modvat credit and they never reversed any amount out the Modvat credit due to handling and process losses. They even never informed the Department about these losses. Moreover, no handling loss could occur while dealing with the raw materials, received by the appellants for job work from the suppliers. Regarding the process loss, the stand of the appellants is not even legally tenable in view of the Chapter note of Plastics and Articles thereof under Chapter 39 of CETA. From that Chapter note, it is quite evident that there could not be any process loss. The weight of the final product plus the weight of wastage has to be equal to the total weight of inputs utilised in the manufacture of final product. Even from the detail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat there is no direct evidence on records to prove clandestine removal of the goods by the appellants without payment of duty, cannot be accepted, keeping in view the facts and circumstances of the case. True that the initial burden to prove the clandestine removal of the goods by a manufacturer, is on the Department. But this burden can be discharged by the Department by bringing on record all the facts and circumstances from which an irresistible conclusion can be drawn that there had been clandestine manufacture as well as removal of the goods by the manufacturer. In this context, reference may be made to the ratio of the law laid down by the Apex Court in Collector of Customs, Madras v. D. Bhoormull - 1983 (13) E.L.T. 1546 wherein it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raw material issued was 52608 kgs and the total actual production shown was 142128 kgs. It means 89520 kgs of excess production, was shown in the chart. The plea of the appellants based on the comprehensive chart that there was no excess production had been rightly not accepted by the Adjudicating Authority. Till August, 1999, the average issue of raw material was quite high, for example, from April, 1999 to August, 1999, the average weight of raw material issued was 146962.2 kgs every month. No explanation had been offered as to why the necessity of issuing such a huge quantity of raw materials arose. Rather it can be safely inferred that it was so done with a view to evade payment of duty by manufacturing unaccounted bags and fabrics, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n question without payment of duty. 10. The role of other two appellants in the clandestine manufacture and removal of the goods without payment of duty, by the appellants company had been fully discussed by the Adjudicating Authority in the impugned Order. We also find from the records that they all had been actively involved along with the appellants company in the illegal activity of clandestine production and removal of the goods without payment of duty. Therefore they had rightly penalised under Rule 209A of the Rules. 11. In view of the discussion made above, the impugned Order confirming the duty demands on the basis of three show cause notices dated 1-10-1999 and 13-4-2000 with equal amount of penalty on the appellants-company a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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