CCE Vs. GAHOI FOODS PVT. LTD.

JUDGEMENT

(1.) In this appeal the Revenue has questioned the validity of the impugned order of the Commissioner (Appeals) vide which he has reduced the duty and set aside the penalty.

(2.) The learned SDR has contended that the Director of the respondents' company, in his statement had conceded the nonaccountal of excess goods as well as shortage of the raw material and that the respondent even debited the entire duty amount before the issuance of the show cause notice, therefore, the duty amount could not be reduced by the Commissioner (Appeals) by observing that the excess goods were manufactured out of the material found short. She has also contended that the penalty could not be set aside as the duty was not deposited voluntarily but only after the shortage of the raw material and excess of the finished goods were detected by the Officers of the Department. Therefore, the impugned order deserves to be set aside.

(3.) On the other hand, the learned counsel has contended that there is no allegation and evidence to prove that the excess goods were manufactured out of any extra raw -material brought from outside in the factory and that it has been only presumed that the respondents might have evaded the duty if there had been no checking in the factory. He has also contended that since there was no apportionment of the penalty amount under Section 11 -AC and Rule 173 -Q, the entire penalty has been rightly set aside.