2000 (10) TMI 965 - AT - Central Excise

Summary

Issues Involved: Alleged clandestine removal of goods to evade Central Excise duty based on discrepancies in physical verification and gate pass records.

Summary:
The case involved the respondents engaged in manufacturing steel ingots, where discrepancies were found during a physical verification by Central Excise Preventive staff. The excess quantity of steel ingots and runners & risers compared to recorded balance raised suspicions of duty evasion. The Department alleged that the respondents transported multiple consignments without proper Central Excise gate passes to evade duty on the goods. A show cause notice was issued, duty demand confirmed, and penalties imposed by the Deputy Commissioner, which was later set aside by the Commissioner (Appeals) based on a Tribunal decision in a similar case.

Upon appeal by the Revenue, the Appellate Tribunal considered the arguments presented. It was noted that no investigations were conducted regarding the alleged removal of goods without duty payment, despite consignees' names being on octroi receipts. The Tribunal observed that the issuance of two gate passes in a single day by the respondents did not conclusively prove evasion, as it was common practice for them to issue separate passes for multiple consignments. The Tribunal also acknowledged the relevance of the earlier Tribunal decision cited by the lower Appellate Authority, which stated that duty evasion cannot be solely established based on octroi records.

Given the lack of concrete evidence to support the allegations of duty evasion and the applicability of the previous Tribunal decision to the present case, the Tribunal found no legal flaws in the Commissioner (Appeals) order. Consequently, the appeal by the Revenue was rejected, upholding the decision in favor of the respondents.