2017 (11) TMI 990 - AT - Central Excise

Clandestine removal - branded Gutkha - onus of prove on Revenue - Held that - Revenue in their memo of appeal, have nowhere improved upon the evidences, which stand considered by the Appellate Authority as insufficient - The findings cannot be arrived at on the basis of assumption and presumption and require tangible and positive evidence. No such evidence stands produced by the Revenue, thus, requiring no interference in the impugned order of the Commissioner (Appeals) - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Appeal against the Order of the Commissioner (Appeals) by the Revenue.
2. Allegations of clandestine removal of gutkha by the respondent.
3. Confiscation of seized goods, demand of duty, and penalty imposition.
4. Evaluation of evidence by the Commissioner (Appeals) in favor of the respondent.
5. Lack of tangible and positive evidence by the Revenue to prove clandestine removal.

Analysis:

1. The judgment deals with an appeal filed by the Revenue against the Order of the Commissioner (Appeals). The Revenue contested the decision regarding the confiscation of seized goods, demand of duty, and penalty imposition due to alleged clandestine removal of gutkha by the respondent.

2. The Central Excise Officers seized the branded gutkha from the respondent's premises as the owner failed to produce duty paid documents, leading the Revenue to suspect clandestine clearance. Subsequently, proceedings were initiated resulting in the original adjudicating authority's order to confiscate the goods, demand duty, and impose a penalty.

3. The Commissioner (Appeals) overturned the original order after considering various pieces of evidence. The Commissioner found that the rejected quality of gutkha and the circumstances surrounding the seized goods did not conclusively prove clandestine removal. The Commissioner highlighted discrepancies in the Revenue's case and the respondent's explanations regarding the sale and transportation of goods.

4. The Commissioner's decision was based on the lack of corroborative evidence supporting the Revenue's allegations of clandestine removal. The Commissioner emphasized the need for tangible and positive evidence to establish such claims beyond doubt. The Commissioner's analysis favored the respondent's arguments regarding the stock balance, cash flow, and transport details, leading to the allowance of the appeal.

5. The Appellate Tribunal upheld the Commissioner's decision, noting that the Revenue failed to produce additional evidence to substantiate their claims of clandestine removal. The Tribunal emphasized the necessity of concrete evidence rather than assumptions or presumptions to prove such serious allegations. Consequently, the Revenue's appeal was rejected due to the insufficiency of evidence supporting the allegations.

This detailed analysis of the judgment highlights the key issues, the evaluation of evidence, and the reasoning behind the decision to reject the Revenue's appeal.