2016 (11) TMI 1337 - AT - Central Excise

Clandestine removal of excisable goods - Held that - I find that the case of the Revenue revolves on the evidence namely diary maintained by Shri Harbans Lal, Dyeing Master and during the course of search, the statement of the partner of the respondent s firm was recorded on 8.6.2000. The statement has been retracted by the respondent within three days and in subsequent statement, he has never admitted the contents of the diary maintained by Shri Harbans Lal, Dyeing Master recovered on 8.6.2000. Moreover, the diary maintained by Shri Harbans Lal, Dyeing Master has not been admitted during the course of investigation by Sh.Harbans Lal. Later on, at the time of adjudicaiton, Shri Harbans Lal has stated that althoUgh the diary has been maintained by him but the contents of the entries of the diary pertained to the respondent and of other parties also. That statement has not been controverted by the Revenue with tangible evidence. Moreover, the respondent supplied the name of the raw material suppliers but all the suppliers have been exonerated by the adjudicating authority. No appeal has been filed against that finding by the Revenue. In that circumstance, there is no evidence to prove clandestine removal of the goods by the respondent as evidence of procurement of the raw material is absent and how the goods transported, the said evidence is also absent - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Alleged clandestine removal of excisable goods without payment of duty.
2. Admissibility and credibility of evidence from diary and statements.
3. Retraction of statement and lack of evidence regarding procurement and transportation of goods.

Analysis:
1. The case involved allegations of clandestine removal of excisable goods without duty payment based on a diary and a statement recorded during an investigation. The initial adjudication confirmed the demand and imposed penalties, which was later set aside by the Commissioner (Appeals), leading to the Revenue's appeal.

2. The Revenue argued that the diary entries, allegedly made by a Dyeing Master on the respondent's instruction, supported the claim of clandestine removal. The respondent's admission and corroboration by statements were cited as evidence. However, the respondent contested this, emphasizing the retraction of the statement, denial of diary contents, and exoneration of suppliers by the adjudicating authority.

3. The Tribunal considered the retracted statement, lack of admission of diary contents by the respondent, and the Dyeing Master's statement attributing entries to various parties. It noted the absence of evidence on raw material procurement and transportation, leading to a lack of proof for clandestine removal. The Tribunal upheld the Commissioner's decision, dismissing the Revenue's appeal due to insufficient evidence supporting the allegations.

In conclusion, the Tribunal found no infirmity in the impugned order, as the evidence presented did not conclusively prove the alleged clandestine removal of goods by the respondent. The decision highlighted the importance of tangible evidence and the lack thereof in establishing the claims made by the Revenue.