9911796707
TMI Blog2017 (1) TMI 1224X X X X Extracts X X X X X X X X Extracts X X X X ..... icers observed from the Form IV (Raw material and components) register maintained by the Noticee that the assessee had depicted a recorded balance of 2813.903 MT of Scrap, 10.472 MT of Silicon and 197.109 MT of sponge iron. The RG-1 (Daily Stock Account) register depicted a recorded balance of 105.122 MT of M S Ingots, 21.748 MT of Runners and risers, 14.290 MT of Alloy Steel Ingots and 168.128 MT of Steel Casting. The last invoice bearing S. No. 635 dated 23.09.2011 was found to have been issued by the Noticee. Besides the above records, there was also a computerized statement showing the scrap lying in the factory premises. This statement was found to be lying on the table of Sh. Rakesh Soni, Director. This statement depicted the scrap position of the unit as 1400MT as on 23.09.2011 as against the recorded balance of 2813.903 MT of scrap in the Form IV register. On being asked about this stock statement, Sh. Rakesh Soni explained that this statement depicted the factual position of the stock of scrap lying in the factory premises whereas excess balance had been shown in the record books due to financial constraints and for obtaining bank limits on the higher side. Perusal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epared on the computer installed in the office premises of their factory as token of its correctness. He was fully satisfied with the manner of physical verification and there was no other stock of scrap lying in the factory premises which had not been weighed. As a consequence of the verification of the scrap, a quantity of 1410.200 MT was physically verified against a recorded balance of 2813.903 MT, meaning thereby that a shortage of 1403.703 MT of scrap was detected. v) On being asked about the reasons for this shortage, he explained to the visiting officers that the unit was under severe financial crunch and in order to gain financial stability by increasing the bank limits, the inflated position of the stocks had been shown in the books of accounts only. Actually, there were a lot of paper transactions without actual receipt of raw material/scrap; that he prepared the details of the invoices in respect of which no material was received by him and only the invoices/bills had been received. With the help of these invoices he had shown the availability of a greater quantity of scrap; he admitted that the CENVAT credit has incorrectly been taken by him as the same had been tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rector. In appeal, the ld. Commissioner (Appeals) upheld the order of Adjudicating Authority. Aggrieved by the same, the appellants are before this Tribunal. 10. Sh. Rakesh Soni, Director for the appellants appearing on behalf of the company submitted that they were new in the business and the statement had been retracted by him on 27.09.2011. He claimed that the weighment chart was fabricated and there was no stock statement but just balance. There was no panchnama drawn in this case and it was inconceivable that 96 trucks could be loaded in 8 hours. He contended that the weight indicated in the physical verification table was identical and the pattern therein does not indicate actual weight. He also argued that no demand can be raised on burning loss and the burning loss can go upto 11%, which has been confirmed through an RTI enquiry from the department and hence, there can be no penalty. 11. He relied upon the following case laws:- 1. CCE Vs. V.M. Rolling Mills 2009 (236) E.L.T. 433 (Del.) 2. Sober Plastics Pvt. Ltd. Vs. CCE, Jaipur 2002 (139) E.L.T. 562 (Tri. Del) 3. Premium Glass Industries Vs. CCE, Jamshedpur 2000 (123) E.L.T. 703 (Tribunal) 4. CCE, Patna Vs. Unive ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsactions without actual receipt of raw material. 15. In his arguments, the appellants have contended that the statement was not voluntary and was taken under pressure. The appellants have referred to the retraction made by him on 27.09.2011. From the said retraction, it is seen that the retraction has been filed before the Commissioner of Central Excise, Chandigarh. Further, the appellants have not alleged that there was any kind of coercion or force or pressure or duress while recording the statement. Without giving any reason, they simply said that the statement was not voluntary. I find that in the absence of any allegation or evidence of force or coercion, or pressure or duress, the retraction carries no weight and is an afterthought particularly since they are admitting that they were actively associated with the officers in the entire verification exercise. I also find that the retraction has not been addressed to the investigation officer who recorded the statement. The Tribunal, in its judgment K.P. Abdul Majeed Vs. CC, Customs 2014 (299) ELT 108 (Tri.- Bang.) has held that the retraction has to be necessarily addressed to the officer to whom the statement was given. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rap, which was detected by the departmental officers on 23.09.2011 and 24.09.2011. 16. The appellant have also argued that no panchnama was drawn on the spot. I find that the weighment exercise was done in the presence of the Director, with his active assistance. The Director has certified the correctness of the weighment exercise and subsequently admitted the shortage of scrap. Therefore, he cant take this plea at this stage. In the case laws of CCE Vs. V.M. Rolling Mills (supra) and Sober Plastics Pvt. Ltd. Vs. CCE, Jaipur (supra), there was no record as to the basis of arriving at the shortages and no stock-taking was done. In the instant case, the weighment exercise was done with the assistance of the Director, who certified the correctness of the entire exercise and also admitted the shortage of scrap. In the case of Premium Glass Industries Vs. CCE, Jamshedpur (supra), the issue was recovery and seizure of the loose sheets in respect of which no panchnama was drawn, which cast doubt on the recovery, which is not the case in the matter at hand. 17. In the case of Galaxy Textiles Vs. CCE, Vapi (supra), the shortages detected at the time of visit were not corroborated by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
