2018 (6) TMI 921 - AT - Central Excise

SSI exemption - suppression of value of clearances - Clandestine removal - Held that - It can be said that the data in the computer printout is reliable and the appellants had indulged in making same kind of duplicate invoices. Revenue has produced the data which shows that number of invoices does not match with dates and they have pointed out 13 such instances in their showcause notice. Apart from that the clearances recorded by the appellant did not match in the clearances recorded in the balancesheet. All the above facts put together point to a case of clandestine clearance. Revenue has substantially made out a case by relying on the balance-sheet, the computer printout, the data received from the buyers and it is up to the respondents to prove otherwise by producing the necessary records which they were unable to trace out earlier. The claim of the respondent that the records have been lost can only be held against them. Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
Revenue's appeal against order setting aside demand confirmation, penalty, and interest.

Analysis:
1. The Revenue alleged that the respondent wrongfully availed SSI exemption by suppressing clearances and clandestinely removing excisable goods during 1996-97 to 1998-99. The respondent declared turnovers for different financial years, got registered after exceeding the exemption limit, and used prefixes for different goods in invoices. Statements from company officials and major customers, along with discrepancies in invoice numbers, supported Revenue's claim of maintaining double invoices.

2. The Revenue argued that evidence like computer printouts, statements, and data from purchasers indicated clandestine clearances. Despite the absence of some physical invoices, the Revenue contended that the demand calculation considered exempted goods' value, and the investigation provided substantial evidence for the allegations. The Commissioner (Appeals) was criticized for presuming the demand solely based on balance-sheet figures.

3. The respondent's counsel emphasized the need for cogent evidence to establish the case. He highlighted discrepancies in prefixes used in invoices and pointed out missing prefixes in buyer-produced invoices. The Commissioner's findings were based on records produced by the Inspector, and the prefixes issue was raised to challenge the Revenue's case.

4. The Tribunal examined recovered documents, statements, and discrepancies in invoices to conclude that the evidence pointed towards clandestine clearances. The absence of recovered sales bills and the respondent's claim of misplaced records were viewed as suspicious. The Tribunal found the Revenue's reliance on balance-sheet, computer printouts, and data from buyers reasonable, shifting the burden to the respondent to disprove the allegations.

5. Citing a precedent, the Tribunal emphasized the respondent's failure to produce necessary records despite opportunities, leading to the decision to allow the appeal and set aside the impugned order. The judgment was pronounced on 25.05.2018 by the Tribunal members, Shri Ramesh Nair, and Shri Raju.

This detailed analysis covers the issues raised in the legal judgment, outlining the arguments presented by both parties and the Tribunal's reasoning leading to the final decision.