2013 (7) TMI 600 - AT - Central Excise

Clandestine removal - Appellant is engaged in the manufacture of PCC Poles - Difference of 283 pieces of PCC poles in the invoice issued by the appellant and the number of poles cleared as per stock register Held that - If the appellant s was having any malafide intention to clear the goods without payment of duty they would not have first entered the goods in the stock register and then would not have shown the clearance of the same This is a case of wrong reflecting of the goods and clerical mistake - Revenue has not been able to adduce any other evidence on record to indicate that said difference in number of poles stand cleared by them clandestinely Appeal allowed Decided in favor of Assessee.

Summary

Issues: Discrepancy in the number of PCC poles cleared, Duty evasion, Clandestine removal

Discrepancy in the number of PCC poles cleared:
The appellant, engaged in manufacturing PCC Poles, faced allegations of a difference of 283 poles in the stock register and the invoices. The Revenue claimed that these poles were cleared without duty payment, leading to proceedings initiated against the appellant. The Assistant Commissioner rejected the appellant's explanations, confirming the demand for duty payment and imposing a penalty. The Commissioner (Appeals) upheld this decision, emphasizing that the discrepancy was noticed thrice and the appellant failed to provide evidence supporting their claim of clerical mistakes. The appellant's assertion that the difference was due to clerical errors was not substantiated, leading to the conclusion that duty was not paid on the 283 poles removed clandestinely.

Duty evasion:
The crux of the issue revolved around whether the difference in the number of poles cleared constituted evasion of duty. The authorities contended that the discrepancy indicated non-payment of duty on the 283 poles removed clandestinely. Despite the appellant's argument that the difference stemmed from inadvertent errors, the authorities found no evidence supporting this claim. The Commissioner (Appeals) highlighted that the appellant's duty assessment was based on the invoice quantities, and the discrepancy remained unexplained, suggesting non-payment of duty on the poles removed. The confirmation of duty demand was grounded in the findings of clandestine removal based on discrepancies between the stock register and the invoices.

Clandestine removal:
The judgment delved into whether the appellant's actions amounted to clandestine removal of goods without duty payment. The appellant's explanation of clerical mistakes and inadvertent errors was met with skepticism by the authorities. The Tribunal noted that if there was a malicious intent to evade duty, the appellant would not have recorded the goods in the stock register before clearance. The Tribunal found the discrepancy to be a case of incorrect reflection and clerical errors rather than intentional evasion. The Revenue failed to provide additional evidence to support the claim of clandestine removal, leading to the Tribunal setting aside the impugned order and allowing the appeal with consequential relief.