2009 (9) TMI 761 - AT - Central Excise

Summary

Issues involved: Allegation of clandestine removal of goods, imposition of central excise duty, penalties u/s Central Excise Rules, 1944, and Section 11AC of the Central Excise Act, 1944.

Summary:
1. The proceedings were initiated against the respondents for clandestine removal of goods involving central excise duty. The Additional Commissioner confirmed the demand and imposed penalties under Central Excise Rules and Section 11AC of the Act. The respondents appealed before the Commissioner (Appeals) and the appeals were allowed, leading to the present appeals.

2. The Tribunal rejected multiple adjournment requests by the respondents' advocate and proceeded to hear the appeals on merits. The entire case was based on documentary evidence, confirmed by a handwriting expert. The Commissioner (Appeals) set aside the order of the adjudicating authority, citing lack of further investigation by the department to corroborate the seized documents.

3. The Department was expected to establish the allegation of clandestine removal with convincing evidence. The Commissioner (Appeals) interfered with the original order based on the absence of additional investigation. However, the Tribunal found that the documentary evidence, proven to be in the respondents' handwriting, was substantial and the lack of further investigation did not invalidate it.

4. The Tribunal noted that the Commissioner (Appeals) failed to consider the quality of evidence presented, focusing on the absence of additional investigation. The order passed by the adjudicating authority was detailed and supported by the seized documents, indicating no arbitrary decision-making.

5. The imposition of penalty under Section 11AC was deemed unjustified as the provision was not in force during the relevant period. Therefore, the penalty under this section was rightly set aside by the Commissioner (Appeals).

6. Consequently, the appeals partly succeeded, with the impugned order quashed and set aside, except for the penalty under Section 11AC, which was not applicable during the relevant period. The original authority's order was restored, and the appeals were disposed of accordingly.