1996 (5) TMI 206 - AT - Central Excise

Summary

Issues involved: Alleged clandestine removal of goods involving duty and penalty imposition.

Summary:
The appeal was directed against an Order-in-Original related to the alleged clandestine removal of goods with duty implications. The Collector confirmed the duty demand and imposed a penalty based on discrepancies between production logs and official records. The appellant argued that the differences were due to reprocessing for quality control standards, and the production log discrepancies were negligible. The appellant contended that there was no corroborative evidence to support clandestine removal and cited the reliability of daily production records over logs maintained by unskilled workers. The Department argued that unrecorded production in official records implied duty evasion.

Upon hearing both sides, it was noted that the Collector disregarded evidence of daily production slips and relied solely on discrepancies between production logs and official records to support the charge of clandestine removal. The Tribunal emphasized that clandestine removal must be proven, not inferred, and that the daily production slips presented by the appellant were more accurate. Citing precedents, the Tribunal highlighted the need for corroborative evidence beyond worker-maintained logs to establish clandestine removal. As only the production log was relied upon without sufficient supporting evidence, the Tribunal concluded that the charge of clandestine removal was not sustained and set aside the impugned order, thereby allowing the appeal.