2009 (10) TMI 800 - AT - Central Excise

Summary

Issues:
- Appeal against Order of Commissioner (Appeals) dated 24-1-2005
- Shortage of finished goods found during verification
- Allegations of clandestine removal of excisable goods
- Burden of proof on the Department
- Arguments regarding weighment of stock and pocket diary entries
- Applicability of previous Tribunal decisions
- Confirmation of demand and imposition of penalty

Analysis:

The appeal in question was against an order dated 24-1-2005 by the Commissioner (Appeals) regarding the shortage of finished goods discovered during a verification visit to the factory premises. The Appellant, a manufacturer of MS Black Tubes and Pipes, was alleged to have engaged in clandestine removal of excisable goods. The original Authority upheld the demand of duty amounting to Rs. 10,65,371 and imposed a penalty of Rs. 3,15,371, which was confirmed by the Commissioner (Appeals).

During the proceedings, the Appellant argued that there was no shortage of finished goods and that the stock was not weighed during the visit, relying on eye-estimation. They claimed that entries in the pocket diary were misunderstood, with certain entries being accounted for in excise records and duties paid. The Appellant contended that the burden of proving clandestine removal lay with the Department and cited Tribunal decisions to support their case.

On the other hand, the Departmental Representative reiterated the findings of the Commissioner (Appeals). The Tribunal carefully considered the submissions and records. It noted discrepancies in the Appellant's claims regarding weighment of goods and pocket diary entries. The Director's confessional statement, payment of Rs. 7.5 lakhs towards duty, and shortage of goods found during the visit were deemed as evidence supporting clandestine removal.

The Tribunal distinguished previous Tribunal decisions cited by the Appellant, stating that the facts of the present case were different. It emphasized the presence of corroborative evidence in the current case, unlike the cases referenced. Ultimately, the Tribunal found no merit in the Appeal and rejected it, upholding the original Authority's decision to confirm the demand and penalty imposed.

In conclusion, the Tribunal's decision was based on the evidence presented, the burden of proof, and the specific circumstances of the case, ultimately leading to the rejection of the Appeal and affirmation of the demand and penalty.