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TMI Blog2004 (6) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 11A(1) of the CE Act, 1944. He has also imposed penalty of Rs. 20,000/- on the appellants under Rules 173Q and 226 of the CE Rules, 1944 apart from appropriating a sum of Rs. 20,000/- towards the provisional release of the seized goods valued at Rs. 3,58,000/-. The other persons involved in the case and on whom penalties have been imposed are not in appeal and in the present appeal, I am concerned with only the appeal of M/s. CPG Textiles. 2. Brief facts of the case are that the officers of Central Excise Erode Division while conducting road patrol on 28-12-1993, intercepted a Tempo van bearing Registration No. TAN 6579 which was found carrying 1275 Kgs of 42s Cotton hosiery yarn on cones in 25 bags with the markings of M/s. CPG Tex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout proper duty paying documents from the appellants. It was in these circumstances, that show cause notice was issued to the appellants which culminated in the order of adjudication passed by the adjudicating authority whereby he has demanded a total duty of Rs. 1,02,804/- as detailed in the order-in-original and imposed penalty and appropriated the amount of Rs. 20,000/- as noted above. 3. Shri S. Kandaswamy, learned Consultant accompanied by Shri R. Balagopal, Consultant appeared for the appellants. The learned Consultants reiterated the grounds of appeal and submitted that, so far as the alleged removal of 1275 Kgs of cotton yarn cones in 25 bags without documents is concerned, the Clerk in the factory debited duty in the personal l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allegation of past clearances without bills etc., it was submitted that all the removals were made under GP-1, and Bill Nos. The learned Consultants also invited my attention to the statements recorded from the broker S.A. Ramaswamy dated 18-1-94, wherein he has specifically stated that the yarn supplied to the various parties, relate to the yarn procured from the appellants mill and also the yarn procured locally. Thus supply of yarn by the broker, cannot be, supply of yarn, made by the appellants. He has also stated that he has not purchased any yarn from CPG Mills (Appellants) without any bill. They have also invited my attention to the statements recorded from the Managing Partner of the appellants, who in the initial statement itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand, in the above order. As regards the demand of Rs. 85,543/- this demand has been quantified as the demand of duty on the goods alleged to have been cleared to various buyers, in the past. The basis of the demand is that the Departmental officers during their visit to various Textiles mills obtained statements from various persons including the broker Ramaswamy who have given statements that the appellants have supplied yarn without GP1 and without bills. The other basis of the department for demand of duty alleging clandestine removal was, entries found in the private note books. As against that, the appellants have indicated the GP1 number and the bill Nos. etc. under which they have cleared the goods to various parties. These detai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coming to the next demand of Rs. 3,959/- on alleged clearance of 1,275 Kgs. of cotton yarn which was seized by the officers, the appellants have clearly stated that duty on the same had already been discharged vide serial No. 236, dated 23-12-93 and the only lapse on their part was that GP1 was prepared belatedly. I observe that this fact has been noted by the adjudicating authority in para 18 of the impugned order. However, it is an admitted fact that at the time of removal of goods, GP1 had not been prepared, and it was prepared belatedly. There was, therefore, violation of the provisions of law. However, the adjudicating authority has not imposed any penalty on account of this violation, but has demanded duty only. Inasmuch as the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It would thus be seen that the total shortage excluding the 5 Kgs negligible shortage of 42s, was only 2,250 Kgs of 34s and not 4,284 (of different counts) as has been made out in the order-in-original. Further, I observe that the Commissioner, vide para 21, while giving finding in regard to the variation of 4,285 Kgs between the RG-1 stock and physical balance was confused and misdirected himself while coming to a conclusion that clandestine removal has been proved by the removal of 25 bags (1,275 Kgs) without GP1. He has thus mixed up the removal of 25 bags on which duty was stated to have been paid, with the difference in stock, relating to 4,285 Kgs, found on verification. In any case, the difference in stock found was 2,250 Kgs and on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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