CCE Vs. ORISSA CONCRETE AND ALLIED INDUSTRIES LTD.

JUDGEMENT

(1.) THE facts giving rise to this appeal by the Revenue and filing of cross objection by the Respondent are, in brief, as under.

(2.) HEARD both the sides.

(3.) AS regards the second question, as to whether the penalty of Rs. 1,43,051/ - imposed on the Respondent has been correctly set aside by the Commissioner (Appeals), I find that this penalty has been imposed in connection with duty demand of equal amount confirmed against the Respondent in respect of shortage of 79.865 MTs of Ingot Moulds one of the raw material, detected at the time of stock taking. Though at the time of stock taking when the shortage was detected, inquiry was made with Shri Navin Kumar Agrawal, Director of the Respondent Company and also with Shri Virendra Singh Thakur, Dy. Manager, Excise and both of them stated that this quantity had been used for captive consumption and the unskilled labours while using this quantity may not have intimated to the production department, the Department has not produced any evidence that this quantity had been removed clandestinely without payment of duty. On this point, the Assistant Commissioner's findings are that the fact of the shortage of Ingot Moulds was accepted by Director of the Respondent company panchnama as well as by Shri Virendra Singh Thakur, Dy. Manager, Excise, and the fact that the Respondent have paid the amount of duty involved on the shortage of the Ingot Moulds confirms that these Ingot Moulds must have been removed clandestinely. I am of the view that just because the Respondent had paid the duty on the shortage of the Ingot Moulds voluntarily, it cannot be concluded that the same had been cleared clandestinely while from the very beginning it has been the contention of the Respondent that this quantity has been used up for manufacture of the finished goods and due to mistake of the unskilled workers the issue of this quantity for manufacture may not have been intimated to the production department. The penalty under Section 11AC is attracted only in a case where there is non -payment, short payment or erroneous refund of duty due to any wilful misstatement, suppression of facts, fraud or contravention of the provisions of the Central Excise Rules with intent to evade payment of duty. In this case, Department has not produced any evidence that any one of these elements were present. In view of these circumstances, I am of the view that the Commissioner (Appeals)'s order setting aside the penalty is correct and does not require any interference.