ORDER
M.P. Bohra, Member (J)
1. This appeal has been filed by the appellants against the Order passed by the Commissioner of Central Excise (Appeals), Patna on 10th June, 2003.
2. Heard Shri K.K. Bhattacharjee, ld, Consultant for the appellants and Shri J.R. Madhiam, ld. JDR for the Revenue.
3. Shri Bhattacharjee submits that the appellants’ two Units of Pepsi Concentrate were broken during manufacturing process during February, 1999 which was shown in the wrong RT 12 and in the same return, it was showed that 143631 pcs. of Crown Cork were found defective on physical verification. He submits that the adjudicating authorities have passed the order mechanically on assumptions and presumptions. He also submits that not a single piece of evidence was cited in support of their findings. He, therefore, submits that the demand on the basis of shortage of Crown Corks is not sustainable. The other evidences like account of other raw materials like sugars consumed, empty bottles procured were required to be producedto establish unaccounted manufacture. He relied on the following decisions :
i) Mewar Bottling Co. (P) Ltd. v. CCE, Jaipur 2002 (140) ELT 237
ii) Ludhiana Bottling Co. 1997 (93) ELT 177
He further submits that the charge of clandestine manufacture and surreptitious removal is required to be proved beyond doubt by the Revenue. But no such evidence has been produced by the Revenue. He relied on the decision in the case of Brims Products v. CCE, Patna reported in 2001 (130) ELT 719. He further submits that the modvat credit taken on the “broken during manufacture” on the two units of Pepsi Concentrate was disallowed without assigning any reasons whereas it is admissible under erstwhile Rule 57D of the Central Excise Rules. He submits that all the shortage were reported in the RT 12 return and there was no question of suspicion. He, therefore, prays that the appeal may kindly be allowed.
4. In reply, Shri Madhiam, submits that neither any account was produced for the defective of Crown Cork nor any evidence was adduced by the appellants. He supports the order passed by the Commissioner (Appeals).
5. I have perused the records and considered the rival contentions raised by the party. In the present case, the demand has been raised on certain quantity of crown Cork which wee defective or which were shortages in part. But there is no other evidence in respect of the other raw materials used in the manufacture of such quantity on aerated water. From perusal of the record and the order, it is clear that no evidence of clandestine removal of the goods have been adduced by the Department. The tribunal in the case of Mewar Bottling Co. (P) Ltd. Vs. Commissioner of Central Excise, Jaipur (Supra) has held that the demand of duty based merely on waste of crown corks or their non-accountal, is not sustainable. In the present case also, the demand is being made only on account of shortages of crown corks. Therefore, the demand on this court is not sustainable. So far as the modvat credit is concerned, if the crown corks or the concentrates damaged or rendered unfit during the manufacture of final product, aerated, water constitutes waste, then the modvat credit is admissible in terms of Rule 57D of Central Excise Rules, 1994. The same view was expressed by the Tribunal’s decision in the case of Commissioner of Central Excise, Chandigarh v. Ludhiana Bottling Co. reported in 1997 (93) ELT 177 (Tribunal). In the present case also no positive evidence to establish the clandestine removal was adduced by the Department. No demand can be raised on presumptions and assumptions. The same view was expressed by the Tribunal in the case of Brims Products v. Commissioner of Central Excise, Patna reported in 2001 (130) ELT 719 (Tri-Kolkata). In view of the above discussions, the appeal deserves to be allowed.
6. Consequently, after setting aside the impugned order, I allow the appeal with consequential relief to the appellants.