2012 (6) TMI 197 - AT - Central Excise

Clandestine removal of goods - non-acceptance of retraction of statement of partners - contradiction of the quantity allegedly cleared by the appellant - non co-relation of evidences and substantiation - Held that - All these inherent commission and omission has to be properly reasoned out by the adjudicating authority in his findings for confirmation of demand against the appellant. In the absence of any such co-relation, we are of the considered view that the issue needs to be reconsidered by the adjudicating authority and hence we set-aside the impugned and remit the matter to the adjudicating authority to reconsider the issue afresh after following the principles of natural justice.

Summary

Issues:
1. Appeal against order in original dated 29.11.2000.
2. Allegation of clandestine removal of goods based on seized fabrics and documents.
3. Confirmation of duty demand and penalty by adjudicating authority.
4. Appeal before Tribunal leading to remand by Tribunal.
5. High Court's judgment quashing Tribunal's order and remanding the matter back.
6. Arguments by appellant's counsel regarding contradictions in evidence and lack of proper investigation.
7. Department's submission on evidences of clandestine removal.
8. Tribunal's analysis of adjudicating authority's reasoning and retraction of partner's statement.
9. Contradictions in quantity of cleared goods and lack of correlation in merchant manufacturers' statements.
10. Tribunal's decision to remand the matter back to the adjudicating authority for reconsideration.

Detailed Analysis:
1. The appeal was made against the order in original dated 29.11.2000, which alleged clandestine removal of goods based on seized fabrics and documents found during a visit to the factory premises. The adjudicating authority confirmed the duty demand and penalty, leading to an appeal before the Tribunal.

2. The Tribunal remanded the matter back to the adjudicating authority, which was challenged by the Revenue in the High Court. The High Court quashed the Tribunal's order, citing lack of reasoning, and remanded the matter back to the Tribunal for further consideration.

3. The appellant's counsel argued against the reliance on retracted statements and highlighted discrepancies in evidence, including contradictions in the quantity of cleared goods and lack of proper investigation. The department, however, reiterated the findings of the adjudicating authority regarding evidences of clandestine removal.

4. Upon thorough consideration, the Tribunal found flaws in the adjudicating authority's reasoning, particularly regarding the non-acceptance of the retraction of the partner's statement. The Tribunal noted that the quantity of cleared goods and the correlation in merchant manufacturers' statements were not adequately addressed, leading to the decision to remand the matter back for reconsideration.

5. The Tribunal concluded that the issue needed to be reconsidered by the adjudicating authority following the principles of natural justice. Therefore, the appeal was allowed by way of remand, setting aside the impugned order and remitting the matter for a fresh review.

This detailed analysis encapsulates the legal proceedings, arguments presented, and the Tribunal's decision to remand the matter back for further consideration, ensuring a fair and just resolution in the case.