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TMI Blog2017 (5) TMI 950X X X X Extracts X X X X X X X X Extracts X X X X ..... ocedure adopted for stock taking - This procedure, to our minds, appears entirely reasonable and cannot be faulted with at this stage specially since there has been no murmur of protest against such procedure any time before. It is also seen from record that Sh. Sanjay Mandal, authorised person of the assessee who witnessed the stock taking, Sh. Nagendra Dutt Sharma, Excise Clerk, Sh. Mahendra Kumar Kabra, Director have also, in separate statements, have concurred with the stock taking. Sh. Srivats Rathi, Director have also agreed to such shortages. In view of the above, we find no reason to interfere with such demands. Parallel invoices - Held that: - various persons on the side of assessee have admitted that goods covered by all these documents were cleared without accounting the same in the statutory records and without payment of Central Excise duty. It is further on record that none of the statements have ever been rectracted. In view of the fact that the factum of clandestine clearance has been admitted by all concerned including Sh. Srivats Rathi, Director, we find no reason to interfere with the demand of Central Excise duty based on these records - It is well establishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis of these GRs, revenue came to the conclusion that goods weighing totally 142.81 MT were removed clandestinely leading to evasion of Central excise duty amounting to ₹ 8,34,175. 3. They also carried out stocktaking of the raw materials as well as finished products in stock. Stortage of raw materials to the extent of 2.775 MT was noticed as well as shortage in stock of finished goods to the extent of 450 MT The duty liability on the raw materials on which cenvat credit had been taken was as ₹ 14,005/- and the duty involved in the finished products found short was to the extent of ₹ 26,21,361. 4. On scrutiny of RG-23A register, it was noticed that as on 26th of October 2007, the balance of credit should have been ₹ 1,12,08,677/- but the same has been shown as ₹ 1,62,08,677/-. Hence, the revenue concluded that credit of ₹ 50 lakh has been availed and utilised fraudulently. 5. During the course of investigation, statements of various concerned persons of the assessee were recorded. i) Shri Mahendra Kumar Kabra, Director in his statement dated 21.7.2008 admitted the following: a) Parallel invoices were being prepared by Sh. Kartar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 42.81 MT of finished goods clandestinely cleared with the help of parallel invoices. (iv) Central Excise duty amounting to ₹ 8,34,175/- on 210.04 MT of finished goods clandestinely cleared with the help of GRs. (v) Demand of ₹ 50 lakhs of fraudulently availed cenvat credit with the proposal to appropriate the said amount already deposited alongwith interest of ₹ 5,16,438/-. 7. After the due process of law, vide the impugned order, the adjudicating authority confirmed all the above proposals. He also imposed a penalty of ₹ 25 lakhs on Sh. Srivats Rathi, Director as well as penalties on other employees of the appellant. 8. In the present appeals the impugned order has been challenged by the appellant-assessee as well as Sh. Srivats Rathi, Director. No appeal has been filed by the other three employees of the assessee-company. 9. With the above background, we have heard Sh. Krishna Kant, ld. Advocate for the appellant and Sh. R. K. Mishra, ld. AR for the Revenue. 10. Ld. Counsel for the appellant took us in detail through the impugned order and the grounds of appeal and various case laws. He emphasised the following grounds: (i) The shortag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the demands of duty raised on the shortages found at the time of search of the factory on 21.07.2008, in the raw materials as well as finished products. Such demands have been strongly opposed by the appellants with the argument that the stock taking has been done on the basis of eye estimation and not on the basis of actual weighment. On going through the records, we find that the stock taking has been duly recorded in the relevant panchnama and it is on record that the stock taking was conducted in the presence of responsible persons representing the assessee. Both the persons representing the assessee have agreed to the result of the stock verification. Shri Umesh Khutenta, one of the witnesses of the stock verification, has been cross-examined before the adjudicating authority and he has stated the procedure adopted for stock taking. According to the witnesses, the standard weight bundles were counted and multiplied with the specific weight and loose items were weighed. This procedure, to our minds, appears entirely reasonable and cannot be faulted with at this stage specially since there has been no murmur of protest against such procedure any time before. It is also seen fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y utilised. The RG-23A register was in the custody of Sh. Mahendra Kumar Kabra, Director at the tune of search. He admitted in his statement dated 21.07.2008 that on the directions of the owners of the company, he has debited an amount of ₹ 50 lakhs vide entry No. 569 dated 18.07.2008. This was admitted to have been done with back date as per direction of Sh. Srivats Rathi, Director. He further admitted that for making the entry with back date, page No. 35 of the RG-23A register was destroyed and page No. 36 was made as 35 and debit entry of ₹ 50 lakhs was made. Later the amount of ₹ 50 lakhs was deposited in cash as per the directions of the department on 11.08.2008 alongwith interest of ₹ 5,16,438/-. 15. From the records of the case as above, it is evident that the credit of ₹ 50 lakhs on 27.10.2007 was taken fraudulently without any supporting invoices for receipt of inputs/ capital goods. The fraud has been compounded by the attempt to fabricate a debit entry for a like amount. The fraud also stands admitted by Sh. Nagendra Dutt Sharma, Excise Clerk. Sh. Mahendra Kumar Kabra, Director as also Sh. Srivats Rathi, Director. Consequently, we find no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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