9911796707
TMI Blog2004 (1) TMI 566X X X X Extracts X X X X X X X X Extracts X X X X ..... turer, along with imposition of equivalent amount of penalty. Modvat credit of Rs. 1,56,668/- was denied and along with imposition of equivalent amount of penalty was ordered. Further penalty of Rs. 1,00,000/- (Rs. One Lakh) was imposed on the manufacturer under Rule 173Q and Rs. 50,000/- on the Director, besides ordering recovery of interest. The order imposing the penalties and demanding duty/ disallowing credit was confirmed by the learned Commissioner (Appeals). Hence the instant appeals. 3. The facts in brief are as under :- The appellant No. 1 are engaged in the manufacture of Rolled products of steel. On a surprise visit to their factory on 9-1-1998, the physical stock in respect of some finished goods was found to be short as co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ejected for permitting credit and was so rejected. 4. Heard both sides. 5. The main ground for demanding duty is that, though the finished goods were shown to have been manufactured and entered in the production records, on physical verification of the stock of individual products aforesaid shortage was noticed. It must be borne in mind that, when a certain level of production is entered in the statutory records maintained by the manufacturer, he does so with full sense of responsibility that he is liable to pay duty due on the goods the production of which is reflected in the production records. Unless and until the manufacturer is sure that the production that has been entered in the excise records maintained by him is such that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ected in the excise records, which on physical verification is found missing from the factory, for which no worthwhile explanation is forthcoming. In this connection, it would be worthwhile to take a critical look at the shortages. In respect of Alloy Steel Round bars, one of the finished goods, the stock as per back balance ought to have been 109.870 MTs. As against that, physical balance is only 31.200 MTs i.e. 28.39% and balance 71.61% seems to have evaporated in thin air. In respect of S.S. Rolled Rounds as against the book balance of 53.660 MTs, the physical stock was 23.00 MTs i.e. 42.86% and the balance 57.14% is missing. The plea that the gap can be attributed to melting losses is laughable, to say the least for the reason, the comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a D.D. to the ship-breaker, for the material purchased from such ship- breaker. From the records it is seen that out of several purchase invoices showing purchase from ship-breakers, the objection is confined only to two invoices, where the evidence of payment is lacking. 9. Accordingly, I hold that the credit has been correctly denied in respect of the said invoice. 10. Though at the time of stay application the issue regarding the jurisdiction of the adjudicating authority to issue Show Cause Notice was raised, this issue was not raised during the hearing of the appeal. Hence the challenge on the grant of jurisdiction is dismissed as not pressed. 11. So far the amount of penalties are concerned, it is pleaded that, no penalty is im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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