CCE Vs. FERTICHEM (INIDA)

JUDGEMENT

(1.) The respondents are manufacturer of unwrought zinc. falling under Chapter 79 of the Schedule to the Central Excise Tariff Act. The Central Excise officers visited the factory of the respondents on 26.4.2000 and conducted physical verification of stock of finished goods and raw materials. During checking of the records, they came across with 4 outward gate passed in loose from in the office of the respondents for unwrought zinc ash and zinc ash which were not accounted for in the production and clearance records of respondents. Accordingly, show cause notice was issued to the respondents demanding duty on the goods specified in the four outward gate passes and proposing penalty. On adjudication, the Additional Commissioner confirmed the demand of Rs. 1,42,712/ - under Section 11A of the Central Excise Act and imposed penalty of equal amount under Section 11AC of the said Act. On appeal by the respondents, the Commissioner (Appeals) has set aside the order of original authority.

(2.) Now revenue has filed the appeal against the order of the Commissioner (Appeals) on the ground that the Commissioner (Appeals) has erred in acceding to the appeal of the party on the ground that the stock of raw material and finished goods were tallying during physical verification. This is not correct as it was found that the quantity shown in 4 outward gate passed recovered on the spot was neither accounted for in the statutory records nor any central excise duty was paid on them. Clandestine removal of the goods is always effected by the party in a secret manner. The non -accountal and clearance of the excisable goods on the 4 outward gate passed has been admitted by the party.

(3.) Shri Ajay Jain, ld. Advocate for the respondents, however relied on the findings of the Commissioner (Appeals) and argued that the demand was confirmed by the original authority only on the basis of 4 outward gate passed which are the private documents of the respondents and there were neither signed by the gate keeper nor there is any evidence that the goods mentioned in these gate passed were cleared from the factory. Even the statement of the author of these gate passed was not recorded by the department nor any inquiry was made from him. Only on the basis of these documents, which is not corroborated by any evidence, duty cannot be demanded any penalty cannot be imposed. He relied on the following decisions :