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TMI Blog2015 (5) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... ate prescribed in the SSI notification and were availing the cenvat credit. Both the units were visited by the Jurisdictional Central Excise Officer on 09.09.2002. Both the units were found to adjacent to each other and separated by a passage. At the time of officers visit to the units, while M/s. Shivam Udyog was found closed since 03.09.2002 due to break-down of the DG set, M/s. Annapurna Industries was functioning. Stock taking of the finished goods and raw materials was done in both the units. The RG-1 register in both the cases showed nil balance. However, certain quantity of the goods manufactured by M/s Annapurna Industries was found in the factory premises of M/s. Shivam Udyog as well as in the passage and the duty involved on thos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd demand of Rs. 4,46,426/- against M/s Shivam Udyog under Rule 12 of the Cenvat Credit Rules, 2002 along with interest thereon under section 11AB and beside this, penalties of equal amount on them under Rule 13(2) of Cenvat Credit Rules, 2002, read with section 11AC of Central Excise Act, 1944. By the same order, the Joint Commissioner also confirmed duty demand of Rs. 9,398/- against M/s Annapurna Industries along with interest thereon under section 11AB in respect of the finished products held to have been removed by them and which have been found partly in the passage and partly in the factory premises of M/s Shivam Udyog. Beside this, another penalty of Rs. 10,000/- was imposed on M/s Annapurna Industries under section 11AC. The unacco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the Joint Commissioner, the same were dismissed by the Commissioner (Appeals) vide order in appeal dated 15.10.2004. Against this order of the Commissioner (Appeals), these appeals have been filed. 2. Shri Bipin Garg, Advocate, the Ld. Counsel for the appellant, pleaded that as regards the stock of plastic containers and caps found in the passage between the two units and in the premises of M/s Shivam Udyog on 09.09.2002, the same had not been cleared to M/s Shivam Udyog but the same had only been temporarily shifted as there were shortage of space in the premises of M/s Annapurna Industries and the second unit of M/s Shivam Udyog was closed, that the Plastic Containers and caps found were not in fully finished condition, that as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 2,90,613/- and Rs. 4,46,426/- demanded from M/s Annapurna Industries and M/s Shivam Udyog under Rule 4(5)A are on much higher side, as the Department has adopted some value of the plastic granules on arbitrary basis and has calculated the amount payable at the rate of 16% ad valorem, that both the appellants had purchased the Granules from JJ Packagerrs (the Authorized Stockiest of Gas Authority of India Ltd.), and on the basis of the invoices of GAIL, the value of the plastic granules alleged to have been found short would be much lower and on that basis, the amount payable would be much lower, and that in view of the above submissions, the impugned order is not sustainable. 3. Shri M S Negi, the Ld. DR, defended the impugned orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been correctly upheld by the Commissioner (Appeals). He accordingly pleaded that there is no infirmity in the impugned order. 4. We have considered the submissions from both the sides and perused the records. Coming first to the question of non-accountal of 780 KG of plastic scrap found in the premises of M/s Annapurna Industries, there is no dispute that the same was not accounted for in the RG-1 Register. However, we are of the view that the appellants plea that the same being intermediate product was meant for recycling and was exempted from duty under notification no. 67/95 CE and for this reason, the same was not accounted for in the RG-1 Register is acceptable. Accordingly, we hold that the confiscation of 780 KG of Plastic Scrap un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntly produced the job work challans along with the job work register, we are of the view that this plea of the appellant is not acceptable for the reason that if the plastic granules had been cleared to job workers under job work challans on 08.09.2002 there is no explanation as to why the Authorized Signatory of the appellants was not aware about the same. Therefore, we hold that the Commissioner (Appeals) has correctly held that the plea of sending the plastic granules to job workers under job work challan are only an afterthought. However, we find that the amount of Rs. 2,90,613/- from M/s Annapurna Industries and the amount of Rs. 4,46,426/- demanded from M/s Shivam Udyog has been determined by adopting some value of the granules and ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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