2005 (9) TMI 178 - AT - Central Excise

Summary

Issues:
Appeal against Order-in-Appeal passed by Commissioner (Appeals) - Validity of demand based on entries in notebooks recovered from respondent's premises - Whether private record for internal movement of goods only - Discrepancies in dispatch records maintained by chemist - Allegation of ingots cleared without payment of duty - Requirement of tangible evidence for proving clandestine removal.

Analysis:
The Revenue filed an appeal against the Order-in-Appeal passed by the Commissioner (Appeals) challenging the setting aside of a demand confirmed by the adjudicating authority based on entries in notebooks recovered from the respondent's premises. The Commissioner (Appeals) held that the private record found is meant for internal movement of goods only. The Revenue contended that the record, maintained by the chemist, indicated discrepancies in the dispatch of ingots, with more ingots mentioned than those on which duty was paid. Statements from the chemist and the General Manager supported this contention, leading to the confirmation of a differential duty by the adjudicating authority.

The respondent argued that while the chemist admitted to preparing dispatch records, he also mentioned that certain entries were not actually dispatched. They emphasized the lack of discrepancy between recorded balance and actual finished goods in the factory. Citing previous Tribunal decisions, the respondent highlighted the need for affirmative and tangible evidence to prove clandestine removal, rather than solely relying on a comparison of entries in different registers.

In the absence of evidence showing excess procurement of raw materials, manufacture of goods cleared without duty payment, or excess consumption of resources, the Tribunal found no basis to sustain the demand solely on the register maintained by the chemist. Emphasizing the requirement for tangible evidence to prove clandestine removal, the Tribunal dismissed the appeal, upholding the impugned order.