ORDER
S.S. Kang, Member (J)
1. Heard both sides.
2. The appellant filed this appeal against the Order-in-Appeal passed by the Commissioner (Appeals). The brief facts of the case are that the appellants are engaged in the manufacture of different brands of Gutkha. On 2.8.99 the officer of Revenue department visited the factory of the appellant and during the search of the factory certain computer generated sheets were recovered and it was also found that there were discrepancies in the stock of raw material as well as the finished product as per their statutory record. The statement of the Managing Director Shri Naveen Jhanjee was recorded where he admitted that the computer generated sheets related to the clearance of Gutkha manufactured by the appellant without payment of duty. A show-cause notice was issued proposing confiscation of the finished goods and inputs which were in excess of the recorded balance and demand of Central Excise duty in respect of the goods cleared without payment of duty. The penal action was also proposed in the show-cause notice. The adjudicating authority confiscated the goods and ordered redemption of the same on payment of redemption fine of Rs. 10,000. The duty was confirmed and penalty of Rs. 50,000 was imposed on the firm as well as on the Director. The appellant filed appeal and the same was dismissed except the penalty on Managing Director was reduced to Rs. 10,000.
3. The contention of the appellant is that the computer generated loose sheets belong to their sister concern and the clearances mentioned in the loose sheets are in respect of sweet supari. The contention is also that the statement of Managing Director was retracted on the next day.
4. The appellant also tried to correlate the entries made in the loose sheets with the clearance made by their sister concern.
5. The contention of the Revenue is that there is no evidence on record is that the Managing Director of the firm who admitted the fact of clearance without payment of duty retracted the statement. As the Managing Director admitted the clearance of various brands of Gutkha without payment of duty, which were mentioned, in the loose sheets, therefore, the duty was rightly demanded.
6. The contention of the appellant is that the entries made in the computer generated sheets are in respect of their sister concern. Shri Naveen Jhangee admitted before the officers of Revenue regarding the clearance of various brands of Gutkha as mentioned in the statement without payment of duty. The appellant produced the retracted statement which was conveyed to the Revenue authority. There is no proof regarding the receipt of this letter in the office of the Revenue nor there is any postal receipt produced by the appellant. In the detailed reply to show-cause notice the appellant had not mentioned this fact rather the appellant mentioned that the statement of Managing Director could be ignored in view of the record produced by the appellant. In these circumstances, I agree with the Revenue that the Managing Director has not been any retraction from the statement made before the Revenue officers. Another contention of the appellant is that the demand cannot be raised on the loose slips maintained by the employees of the manufacturer. They relied upon the decision of the Tribunal in the case of Essvee Polymers (P) Ltd. v. CCE, 2004 (93) ECC 305 : 2004 (165) ELT 291 and in the case of Aar Kay Industries v. CCE, 2004 (165) ELT 412. In the case of Essvee Polymers (supra), the Tribunal held that private slips cannot be made basis for confirmation of demand on the ground that the goods were cleared without payment of duty. The Tribunal held that the mere presence of slips is not sufficient for demand of duty in absence of other evidence regarding excess and shortage of raw material etc. In the present case there was excess of raw material as well as the final product. The raw material was not entered in the statutory record. These slips were not prepared by uneducated employees but these are computer-generated record and the Managing Director of the firm admitted that the entries in these slips relate to the clearance of various brand of Gutkha. Therefore, the ratio of this decision is not applicable to the present case. In the case of Aar Kay Industries, the Tribunal held that without physical verification demand cannot be raised regarding removal of goods without payment of duty. In the present case physical verification of the stocks showed the excess of inputs as well as final product. In these circumstances, the ratio of the above decision of the Tribunal is not applicable in the facts of the present case. In view of the above discussion, the appeals are dismissed.