ORDER
S.S. Kang
1. The applicants filed this application for waiver of pre-deposit of duty demand of Rs.2,73,253.50 and penalty of Rs. 2,80,000.00.
2. In this case the applicants are engaged in the manufacture of sugar and excisable products i.e. molasses came into existence during the manufacture of sugar. The applicants made a request for remission of duty under Rule 49 of the Rules on the molasses found short on the ground that the molasses were destroyed due to natural causes. The request for remission was declined and the demand was confirmed.
3. Ld. Counsel, appearing on behalf of the applicants, submits that the shortage of the molasses was less than two per cent, which is permissible as held by the Tribunal in many cases. He, further, submits that the stock was measured by dip method and the Tribunal in the case of U.P. State Sugar Corporation Ltd. vs C.C.E. reported in 2000 (117) ELT 83 and in the case of Ghatampur Sugar Company Limited vs C.C.E. reported in 1996 (85) ELT 69 held that demand cannot be sustained on the basis of dip measurement by method. He, therefore, submits that the application be allowed.
4. Ld. D.R., appearing on behalf of the revenue, submits that there is a specific finding by the Commissioner (Appeals) that shortage is of 11.48 per cent, which is more than two per cent as mentioned by the applicants. He, further submits that liquids can only be verified by dip method, which is a correct method.
5. Heard both sides.
6. In this case, the contention of the applicants is that shortage is less than two per cent whereas the Commissioner (Appeals) held that the shortage is of 11.48 per cent. The case of the applicants is arguable, which requires detailed examination of the evidence produced by the applicants. Therefore prima facia it is not a fit case for total waiver of the duty and penalty. The applicants are, therefore, directed to deposit a sum of Rs. 50,000.00 within a period of four weeks. On deposit of Rs. 50,000.00, the deposit of remaining amount of duty and penalty is waived for hearing of the appeal. To come up for reporting compliance on 24.07.2001.
(Dictated in Court).