2007 (11) TMI 52 - AT - Central Excise

Demand raised on account of Clandestine removal on basis of loading slips recovered from the transporter s premises & statement of partner Investigation regarding ships not made by dept. at buyer s end so benefit of doubt gods in favor of assessee Impugned order is set aside

Summary

Issues:
- Allegation of clandestine removal based on loading slips recovered from transporter's premises
- Lack of proper correlation between the company and the loading slips
- Failure to investigate up to the buyers' end
- Reliance on partner's statement without corroborative evidence

Analysis:
1. The case involved allegations of clandestine removal against the appellants based on loading slips recovered from a transporter's premises. The appellants contended that the names on the slips did not match their unit's name, raising doubts about the correlation. The transporter, through an affidavit, explained that the slips were for noting client requirements and not necessarily for executed transportation. The Tribunal noted that the transporter's affidavit was not considered by the Commissioner (Appeals) and emphasized the importance of establishing a correct correlation between the company and the slips to prove clandestine removal.

2. The appellants questioned why Revenue officers did not investigate up to the buyers' end to gather more evidence supporting the allegation of clandestine removal. The Tribunal highlighted the lack of additional evidence and the doubtful nature of the transport slips. It stressed that charges of clandestine removal require concrete evidence, not just surmises or conjectures. Due to the absence of corroborative evidence and the questionable nature of the slips, the Tribunal extended the benefit of doubt to the appellants.

3. The Tribunal also addressed the reliance on the partner's statement by the Revenue. It noted that the partner's statement lacked corroboration and did not convincingly admit to clandestine removal. The Tribunal found the language used in the partner's statement lacking in confidence regarding any admission of clandestine removal. Ultimately, in light of the discussions and considerations, the Tribunal set aside the previous order, allowing both appeals in favor of the appellants, providing them with consequential relief.

This detailed analysis of the judgment highlights the key issues raised, the arguments presented by the parties, and the Tribunal's reasoning leading to the decision in favor of the appellants.