2019 (6) TMI 1349 - AT - Central Excise

Clandestine removal - confiscation of seized goods loaded in the intercepted truck on the ground that the same has been cleared without payment of duty - Revenue s case is that the said excise invoice was raised subsequently by assessee on receiving the information of interception of the truck - HELD THAT - There is no dispute with the finished goods intercepted by the officers tallied with the depot challan (transporter copy) accompanying the consignment with regard to the item code, quantity and description of the goods. Though Shri Ajay Kumar Shah who was accompanying the consignment made a call to his factory but the subject matter of the call is not available with the Revenue. Making a call by itself intimating the office persons as regards interception of the truck will not go to prove that the excise invoice was made on receipt of such information. The said findings of the Lower Authorities are based upon the assumption and presumption. As such, inasmuch as the goods found loaded in the truck and intercepted by the officers have already discharged their duty burden, there is no reasons to confiscate the same. Shortages of goods - HELD THAT - There is no evidence to show that the said goods have been cleared by the assessee without payment of duty - It is well settled law that findings of clandestine removal cannot be upheld on the basis of shortages detected in the stock at the time of visit of the officers - the Central Excise officers have not presented any evidence to show removal of the said goods, the demand of duty cannot be upheld on the basis of only shortages - demand set aside alongwith penalty. Confiscation of Currency - HELD THAT - Apart from the fact that the Currency in question was not recorded in the cash book records, Revenue has not advanced any reason to show that the same was the sale receipts of the smuggled goods - confiscation of the Indian Currency is set aside. Penalties - HELD THAT - Inasmuch as the demand have been set aside against M/s Prabhat Zarda Factory (India) Ltd. alongwith setting aside of confiscation of Indian Currency, the penalties imposed upon them as also on the other two appellants are required to be set aside - the confiscation of the truck is also required to be set aside. Appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
- Confiscation of goods loaded in intercepted truck
- Confirmation of demand of duty on shortages of goods
- Confiscation of unaccounted Indian Currency
- Imposition of penalties
- Confiscation of truck

Analysis:

Confiscation of Goods Loaded in Intercepted Truck:
The Revenue alleged that the goods were cleared without payment of duty, but the appellant had provided a challan and Central Excise invoices issued by them. The tribunal found that the goods intercepted matched the depot challan accompanying the consignment, and the call made by an individual accompanying the consignment did not prove that the invoice was raised subsequently. As there was no evidence to support the confiscation, it was set aside.

Confirmation of Demand of Duty on Shortages of Goods:
The tribunal noted that there was no evidence to prove that the goods were cleared without payment of duty based on shortages detected during the officers' visit. Citing legal precedents, it was established that clandestine removal cannot be upheld solely on stock shortages. As the Central Excise officers failed to present evidence of removal, the demand of duty and penalty were set aside.

Confiscation of Unaccounted Indian Currency:
The tribunal found insufficient evidence to link the unaccounted cash to clandestine activities. Legal precedents emphasized that the burden of proving the currency as sale proceeds of smuggled goods lies with the Revenue. As the Revenue did not provide reasons to establish the cash as proceeds of smuggled goods, the confiscation of the Indian Currency was set aside.

Imposition of Penalties:
Since the demands against the appellant were set aside, the penalties imposed on them were also set aside. The tribunal ordered the penalties to be revoked in line with the decisions on the demands and confiscations.

Confiscation of Truck:
Considering the setting aside of demands and confiscations, the confiscation of the truck was also overturned. The tribunal provided consequential relief to the appellant by allowing all three appeals.

In conclusion, the tribunal allowed all appeals, setting aside the confiscations, demands, penalties, and the truck confiscation, providing relief to the appellant.