2004 (12) TMI 149 - AT - Central Excise

Summary

Issues:
1. Duty demand and penalties confirmed against the company for clandestine removal of finished goods.
2. Lack of tangible evidence to prove clandestine removal.
3. Arguments regarding lack of evidence and discrepancies in the case.
4. Reiteration of correctness of the impugned order by the SDR.
5. Detailed analysis of evidence and lack thereof in the case.
6. Comparison with previous legal judgments.
7. Conclusion and setting aside of the impugned order.

Detailed Analysis:
The appeals were directed against an order confirming duty demand and penalties on the company for clandestine removal of finished goods through certain invoices. The Counsel argued that there was no tangible evidence to prove the clandestine removal, stating that the invoices were prepared for financial assistance without actual movement of goods. Additionally, the Counsel highlighted the lack of evidence regarding extra raw material receipt, electricity consumption, or labor employment. The SDR, however, supported the impugned order based on recovered invoices indicating goods clearance without duty payment. Reference was made to legal precedents to support the argument.

Upon review, it was noted that during a raid, invoices were seized, but statements from involved parties did not admit to clandestine removal. No evidence supported the claim of goods clearance through the seized invoices. Furthermore, discrepancies in raw material receipt, labor utilization, and electricity consumption were not proven. The Tribunal emphasized the necessity of tangible evidence to prove clandestine activities, citing previous legal judgments for support.

The Tribunal found that the legal precedents referred by the SDR were not applicable to the case due to lack of admissions or evidence of clandestine removal. Unlike the cases cited, no corroboration or admission existed in the present situation. The Tribunal concluded that the charge of clandestine manufacture and removal was not proven, leading to the setting aside of the impugned order against all appellants. The appeals were allowed with consequential relief, adhering to the law.