2018 (5) TMI 815 - AT - Central Excise

Clandestine removal - shortage of finished goods - entire case of the Revenue is based upon the shortages detected at the time of their visit - Held that - It is well settled law that such shortages cannot lead to the allegations and findings of clandestine removal - reliance placed in the case of Shahi Exports Pvt. Ltd. Versus Commissioner of C. Ex. & S.T., Ghaziabad 2015 (8) TMI 1382 - CESTAT NEW DELHI . Inasmuch as there is no other corroborative evidence on record, there are no reasons to uphold the impugned orders - appeal allowed - decided in favor of appellant.

Summary

Issues: Alleged clandestine removal of goods based on shortages detected during stock verification.

The judgment delivered by Mrs. Archana Wadhwa, Member (Judicial) at the Appellate Tribunal CESTAT NEW DELHI pertained to a case where the appellant, engaged in the manufacture of aluminium wire rod and conductor, faced allegations of clandestine removal of goods due to shortages detected during a stock verification conducted by revenue officers. The revenue initiated proceedings resulting in an order demanding duty of &8377; 3,68,196 and imposing an equal penalty. However, Mrs. Archana Wadhwa noted that the entire case against the appellant was solely based on the shortages found during the visit, emphasizing that such shortages alone cannot lead to allegations of clandestine removal. She referred to legal precedents, including the decision of the Hon'ble Allahabad High Court and various Tribunal cases, to support this stance. Citing the lack of any other corroborative evidence on record, Mrs. Archana Wadhwa set aside the impugned orders, allowing the appeal with consequential relief. The judgment highlights the importance of substantial evidence in cases involving allegations of clandestine removal and underscores the principle that shortages alone are insufficient to establish such claims without additional proof.