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2024 (1) TMI 80 - AT - Central ExciseClandestine removal - removal of the excisable goods by the Noticee M/s. Modi Agro Products (MAP) to M/s. MARKFED MP Agro - Proper verification has taken place or not - HELD THAT - The Principal Commissioner had very meticulously examined all the records that were filed and after examining the audited figures of sales and excise duty, and the sales considered in computation by the department, recorded categorical findings which have been reproduced above. The Principal Commissioner also noted that to establish a case of clandestine removal, it was imperative for the department to substantiate the allegations, which it completely failed to. On the other hand, the respondent produced documents which established that no clandestine removal had taken place. The Principal Commissioner also recorded a categorical finding, based on reconciliation of the figures. It was not necessary for the Principal Commissioner to refer to each and every invoice, as has been contended by the learned authorized representative. In fact, the figures recorded by the Principal Commissioner have not been disputed in this appeal - It is, therefore, not possible to interfere with the findings recorded by the Principal Commissioner on this issue. Clandestine Removal - removal of the excisable goods by the Noticee M/s. Modi Agro Products (MAP) to M/s. Aviral Biotech and Fertilizers Pvt. Ltd. (ABFPL) - accounts of ABFPL can be relied upon to prove the clandestine removal or not - HELD THAT - No specific error has been pointed out in the grounds of appeal or by the learned authorized representative appearing for the department - the Principal Commissioner has recorded a finding that the raw material receipts matches with the quantity of the finished goods sold from the factory which have been cleared on payment of appropriate central excise duty. The Principal Commissioner also noticed that the charge of clandestine removal is a serious charge which cannot be made only on the basis of presumptions and assumptions and that the department failed to establish clandestine removal by corroborative evidence. There is no error in this finding and indeed none has been pointed out. Clandestine removal - Removal of the excisable goods by the Noticee M/s. Modi Agro Products (MAP) to M/s. Sumitra Agrotech (SA) - Allegation on the basis of third party records - HELD THAT - The Principal Commissioner has recorded that the department failed to produce clinching evidence for establishing clandestine removal and in fact no investigation had been carried out at the premises or the books of accounts of raw material suppliers. The department has not been able to point out any error in this finding recorded by the Principal Commissioner. Clandestine removal - removal of the excisable goods by the Noticee M/s. Modi Agro Products (MAP) to private parties/Dealers - Clearance to dealers under cover of delivery challans which were not recorded in the accounts of MAP for the purpose of payment of Central Excise duty and other taxes by violating statutory provisions/norms - corroborative evidences or not - HELD THAT - The Principal Commissioner has observed that the allegation of clandestine removal has not been corroborated by clinching evidence and no linkages were investigated to establish such a finding. This finding does not call for any interference as no specific error could be pointed out by the department. The appeal filed by the department deserves to be dismissed as there is no perversity in any of the findings recorded in all the issues - application disposed off.
Issues Involved:
1. Clandestine removal of excisable goods to M/s. MARKFED & MP Agro. 2. Clandestine removal of excisable goods to M/s. Aviral Biotech and Fertilizers Pvt. Ltd. (ABFPL). 3. Clandestine removal of excisable goods to M/s. Sumitra Agrotech (SA). 4. Clandestine removal of excisable goods to private parties/Dealers. Summary: Issue 1: Clandestine removal to M/s. MARKFED & MP Agro The Principal Commissioner meticulously examined the records, including excise returns and audited financial statements, and found no evidence of clandestine removal. It was noted that the department failed to substantiate the allegations with tangible evidence. The reconciliation of figures showed no discrepancy, and the payment sheet from MP Agro was not properly verified. The Principal Commissioner concluded that the allegations were unsustainable due to lack of evidence and computational errors, leading to the dropping of the demand of Rs. 3,30,13,508/-. Issue 2: Clandestine removal to M/s. Aviral Biotech and Fertilizers Pvt. Ltd. (ABFPL) The Principal Commissioner found that the accounts of ABFPL were unreliable and incomplete. The raw material receipts matched the finished goods sold, and no evidence of excess procurement was found. The department's case was based on assumptions without corroborative evidence. The Principal Commissioner emphasized that serious charges like clandestine removal require substantial evidence, which was lacking. Consequently, the demand of Rs. 90,22,112/- was set aside. Issue 3: Clandestine removal to M/s. Sumitra Agrotech (SA) The Principal Commissioner noted that the case was based on third-party records without any clinching evidence. No discrepancy was found in the stock, and no investigation was carried out at the premises of raw material suppliers. The department's allegations were based on assumptions and lacked corroborative evidence. The Principal Commissioner concluded that the case of clandestine removal was not established. Issue 4: Clandestine removal to private parties/Dealers The Principal Commissioner observed that the allegations were not supported by sufficient corroborative facts and evidence. No linkages were investigated to establish the findings. The Principal Commissioner reiterated that the case of clandestine removal requires documentary and material evidence, which was absent in this case. Therefore, the demand of Rs. 12,96,503/- was not sustained. Conclusion: The appeal filed by the department was dismissed as there was no perversity in any of the findings recorded on the four issues. The Cross Objections were disposed of accordingly.
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