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TMI Blog2017 (3) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... the demand, we find that the Commissioner has confirmed confiscation merely on ground of preponderance of probabilities, stating that the amount is of sale proceeds of short found goods - no investigation has been done to link the said cash with any receipt of clandestine removal - confiscation set aside. As regard imposition of penalties against Shri R.S. Tomar, Shri Deepak Gupta, Shri Anant S. Sheth and Shri T. Rama Rao, since the demand against M/s SKS Ispat does not survive, therefore no case for penalty is made out against the said persons. Appeal allowed - decided in favor of appellant. - E/1737/2012-EX [DB], E/1739/2012-EX [DB], E/1740/2012-EX [DB], E/1741/2012-EX [DB], E/1738/2012-EX [DB] - A/50496-50500/2017-EX[DB] - Dated:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sident Works) and Shri T. Rama Rao, (AGM Tax) requested to release the cash, stating that the cash pertains to the company and has been properly accounted for and annexed copy of accounts to this effect. 1.1 On the basis of such verification with regard to discrepancy in the stock and finding of cash, the Department issued the SCN, seeking recovery of the Central Excise duty attributable to the shortage of finished goods, alleging the same to have arisen out of clandestine removal of short found goods and also sought to confiscate the seized cash in terms of Section 121 of the Customs Act, 1962 as made applicable to Central Excise by virtue of Notification No. 68/63 dated 04.05.1963. Penalty was also proposed to be imposed upon App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lying near Storage Yard and Bunker, the same was also verified by Volumetric method. The Rolling Mill Scrap was of random size and quantity was very huge, hence physical verification was not done and resultantly, shortages were alleged. He submits that the Appellants were also recording stock on estimation basis, as may be seen from the statement dated 25.07.2008 of Shri Deepak Gupta, which have led to detection of shortage by officers. He submits that the shortages as against declared stock in case of Angle, Beam, Channel, bloom billet was hardly 3% of the stock and in case of Sponge Iron, it is hardly 2.74%. In case of Ferro Alloy i.e. Silicon Maganese, he submits that the verification was not done properly as pointed out by Shri Anant S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 2015 (325) E.L.T. 106 (P H), CC EX. S.T., Ludhiana -Vs.- Anand Foun. Eng. 2016 (331) E.L.T. 340 (P H) and Comm.. -Vs.- Vikram Cement (P) Ltd. 2014 (303) E.L.T. A82 (All.), to show that shortage of goods cannot lead to inference of goods having been removed without payment of duty. He also submits that since the cash does not pertain to any proceeds of clandestinely removed goods nor it is notified goods hence the same cannot be confiscated and places reliance upon the judgment of CCE, Meerut -Vs.- Moon Beverages Ltd. 2002 (150) ELT 976 (TRI DEL). He also files written submission in this regard. 4. On the other hand, the ld. D.R. appearing for the respondent reiterates the findings recorded in the impugned order and fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nama, same practice has been adopted by the officers for conducting physical verification and the shortages occurred are around 2.5% to 3% of the stock lying at the factory. Shri Tomar, President Works, though admitted such shortages arrived at, but nowhere stated that the same has arisen due to clandestine removal of goods. We also find that Shri Deepak Gupta, the Joint Managing Director in his statement has clearly stated that the stock was recorded on cross sectional weight basis or by dip method. No instance of any removal of goods, found to be shortage, has been adduced by the authority. No buyer of goods or evidence of removal such as, transportation of goods, receipt of consideration is appearing on record nor there seems to be any i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of facts, we hold that the duty demand cannot be held merely on the grounds of shortages. Even such shortages have been reported to be in the range of less than 3% of the total quantity recorded in the books. 8. As regard confiscation of seized cash and appropriation thereof against the demand, we find that the Commissioner has confirmed confiscation merely on ground of preponderance of probabilities, stating that the amount is of sale proceeds of short found goods. We find that no investigation has been done to link the said cash with any receipt of clandestine removal. The Appellant had produced the copies of their accounts to the authorities, showing the cash appearing in books. In such circumstances, when no evidence has been addu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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