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TMI Blog2013 (11) TMI 1388X X X X Extracts X X X X X X X X Extracts X X X X ..... en manufactured in the appellant’s factory. The department’s allegation that the molasses seized from the tankers had been clandestinely cleared by the appellant is not supported by any evidence - As regards excess stock of molasses in the appellant’s factory, the Appellant’s plea is that during summer season on account of heat, foam is generated in the tanks because of which the dip reading gets distorted - there is substance in the appellant’s plea – BAJAJ HINDUSTAN LTD. Versus COLLECTOR OF CENTRAL EXCISE, KANPUR [1994 (6) TMI 59 - CEGAT, NEW DELHI] - It cannot be said that there was excess unaccounted stock of molasses in the appellant’s factory, more so when the molsses is under physical control of the State Excise Authorities and no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of stock of molasses, there was excess stock vis-`-vis balance in the RG-I Register. The officers placed 477 quintals of molasses in tankers under seizure on reasonable belief that same had been cleared without payment of duty. Statement of Shri R.S. Pundeer, Manager of the said M/s.Dhampur Sugar Mills Ltd. Dhampur factory was recorded wherein he stated that excess of the stock of molasses may be due to foam formation due to heat and that in their factory, after 30th April, 1997, there was no clearance of molasses. 1.2 Proprietor of M/s. Suman Trading Company, who had issued the challans, was summoned and his statement was recorded wherein he confirmed having supplied the molasses, in question, to M/s. Zuhaid Sheera Supply Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t for excess quantity of molasses, the appellant had explained that same was due to distortion in dip reading due to foam formation in molasses due to heat, that the department has not supplied the statements of tankers drivers and that in view of this, the impugned order confiscating molasses and imposing penalty on the appellant is not sustainable. Shri Alok Arora, Advocate also pleaded that when the appellants plea from the beginning was that the molasses seized from the tankers had not been supplied by the Appellant, but had been supplied by M/s. Suman Trading Co., Dhampur, the department should have taken samples of the molasses from the stock in the factory and from the tankers and should have got the same tested for ascertaining as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excess quantity of 5764 quintals found in the factory clearly shows that the appellant were not correctly accounting for the quantity of molasses manufactured by them and the quantity seized from the tankers had obviously come from excess unaccounted excess stock. With regard to the appellant s plea that the excess quantity is within tolerance limit of 10%, he cited the judgement of Hon ble Allahabad High Court in the case of Kesar Enterprises reported in 2008 (221) ELT 329(A), wherein it was held that shortage in the stock of molasses beyond 2% would have to suffer duty. 5. I have considered the submissions from both the sides and perused the records. 6. Ongoing through the records, I find that the department s case is based on the st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cleared by the appellant is not supported by any evidence. As regards excess stock of molasses in the appellants factory, the Appellant s plea is that during summer season on account of heat, foam is generated in the tanks because of which the dip reading gets distorted. I am of the view that there is substance in this plea. I also find that it is not disputed that the alleged excess quantity of 5670 qtls. of molasses is well within 10% of the molasses of 1996-1997 sugar season, stored in the tanks, which, in view of the judgement of the Tribunal in the case of Bajaj Hindustan Ltd. (supra) has to be condoned. The judgement of Allahabad High Court in the case of Kesar Enterprises is in respect of storage loss. In view of this, I hold that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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