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TMI Blog2012 (5) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... actory of the appellant by surprise and conducted a verification of stocks. They found that two items of raw materials, namely MS Ingots and Furnace Oil, were found to be short as compared to the stock that should have been available as per their records. The Officers made out a case that the said inputs found short was cleared clandestinely and therefore demanded duty on such goods. The details of shortage found was as under : Description Quantity as per Registers (in MT) Quantity actually found (in MT) Qty. Short (in MT) Short % Duty Demanded MS Ingots 802.445 715.470 86.975 10.83% 198721 Furnace Oil 48.625 45.268 3.357 0.75% 9590 Total 208311 3. A Show Cause notice issued in this re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tage between accounted stock and finished stock. The difference was estimated at 86.975 MTs out of 802.445. He points out that during the stock taking the quantity of goods lying in furnace was not taken into account which was about 56 MTs. Once this is taken into account the balance quantity is only 30 MTs which is only 3.5% of the quantity accounted which is due to approximate method of estimation of stock. 6. In the case of Furnace Oil, he points out that the stock was ascertained by dip reading of the quantity available in the tanks and then converting the volume into weight using conversion factor. As against the accounted stock of 54.665 MTs, a shortage of 3.357 MT was detected. Here again the difference in stock is very margina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the shortage of Furnace Oil. The item by its very nature can cause errors in accounting when used for manufacturing process. The method of ascertaining stock also is somewhat approximate. There is no proof of clandestine clearance of the goods after accounting in their register. The shortage found is also small. So I give the benefit of doubt to the appellants. 10. In the case of Ingots also, the stock taking was done by approximation method. The percentage of shortage noticed is higher at 10.8%. One plea of the appellant is that the stock of goods in furnace has not been taken into account during stock taking. The ld. AR points out that the RG-23A entry on 11-11-2005 shows an issue of 65 MTs of goods for manufacture and this quantity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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