CADBURY (INDIA) LIMITED Vs. CCE

JUDGEMENT

(1.) THE relevant facts of the case, in brief, are that the appellants are engaged in the manufacture of food products falling under sub -heading 1803.00 of the First Schedule to the Central Excise Tariff Act, 1985. On 18.12.1997, the central excise officers visited the factory of the appellants and verified the stock of the finished goods. The said officers detected shortage and excess of various finished goods in comparison with the balance shown in RG -1 register. The adjudicating authority confirmed the demand of duty of Rs. 2,00,217/ - and imposition of penalty of equal amount under Section 11AC of the Central Excise Act, 1944 and Rs. 50,000/ - under Rule 173Q of the Central Excise Rules, 1944 and also imposed redemption fine of Rs. 750/ - in respect of the excess seized goods. The Commissioner (Appeals) in the impugned order upheld the adjudication order.

(2.) THE learned advocate on behalf of the appellants submits that there was no shortage of goods. In fact the alleged short quantity was lying in the finishing room of the production floor. He submits that Shri Dhiraj Mishra in his statement before the central excise officers categorically stated that the goods were lying in the production floor. But, due to oversight the said quantity was entered in the RG -1 register. He submits that the allegation of clandestine removal is without any basis and, therefore, the demand of duty and imposition of penalty are unjustified. He submits that the alleged short quantity which was lying in the finishing room was subsequently cleared on payment of duty and details of clearances of the said goods were annexed in reply to the show cause notice. He relied upon the following case laws:

(3.) THE learned SDR reiterates the findings of the Commissioner (Appeals). He submits that in reply to show cause notice, it was stated by the appellants that the goods were available in the finishing room which cannot be verified at belated stage. He submits that the appellants admitted the shortage of good which were removed clandestinely and, therefore, the demand of duty and imposition of penalty are proper.