2017 (2) TMI 248 - AT - Central Excise

Rejection of books produced by appellant - Valuation - inclusion of certain disputed clearances in the value of clearances under N/N. 34/2003 - Held that - If the appellant produced any records in the defence and revenue was successful in finding holes in the said evidence, the same cannot be accepted - appeal dismissed - decided against appellant.

Summary

Issues:
Appeal against demand of duty based on disputed clearances under Notification No. 34/2003.

Analysis:
The appeal was filed against the confirmation of duty demand by including disputed clearances in the value of clearances under Notification No. 34/2003. The demand was upheld by lower authorities, leading the appellants to approach the Tribunal. The basic defense of the appellant was that certain goods wrongly included in clearances were defective goods cleared after being received back as defective. However, the lower authorities rejected the evidence presented by the appellant, considering the parties involved as fictitious.

The Tribunal noted that the appellant failed to appear on multiple occasions, leading to the decision being based solely on the record. The Commissioner (Appeals) thoroughly examined the issue and found discrepancies in the appellant's claims. The Commissioner observed that the parties mentioned by the appellant were non-existent or bogus, as confirmed through verification and summons that were returned as "Not known." Additionally, the appellant could not provide written rejection notes from customers regarding the alleged rejection/return of garments, further weakening their defense.

The Tribunal concurred with the Commissioner's findings, emphasizing that the burden of proof shifted to the appellant once the department established the non-existence of the parties mentioned in the transactions. The Tribunal cited a Supreme Court case to support the burden of proof shifting to the appellant in such circumstances. It was highlighted that the appellant's mere assertions without substantial evidence could not dismiss the non-existence of the parties involved. Consequently, the Tribunal upheld the demand, penalties, and confiscation/redemption fine due to the lack of compelling evidence or extenuating factors in the appellant's defense.

In conclusion, the Tribunal dismissed the appeal, emphasizing that if the appellant's defense evidence was found lacking by the revenue authorities, it could not be accepted. The judgment was pronounced on 06/01/2017, affirming the decision based on the detailed examination of the evidence and the failure of the appellant to substantiate their claims effectively.