2017 (3) TMI 995 - AT - Central Excise

Clandestine removal - Gutkha - assessee claims that the goods are being sold to unknown buyers on cash basis - Held that - the goods seized at Raipur were infact manufactured and cleared by the appellant-assessee clandestinely without payment of duty - the claim of the appellant-assessee that the goods are covered by the 22 invoices submitted by them has been made only with the view to escape from the clutches of the law. While the onus is on the Revenue to establish clandestine removal, they are not required to prove the case with mathematical precision as such a case involves deliberate and well thought out modus operandi to evade duty - appeal dismissed - decided against appellant.

Summary

Issues:
1. Duty payable on seized goods of Gutkha bearing specific brand names.
2. Allegations of clandestine clearance of goods without payment of duty.
3. Dispute regarding payment of duty on 2404 bags of Gutkha.
4. Claim of the appellant regarding double payment of duty and request for refund.
5. Examination of invoices submitted by the appellant to cover the seized goods.
6. Investigation findings indicating manipulation of records and clandestine removal of goods.
7. Determination of whether the seized goods were manufactured and cleared clandestinely.
8. Evaluation of the appellant's claim regarding the invoices and the totality of circumstances.
9. Application of legal precedents in cases of clandestine activities and duty evasion.

Analysis:
The judgment by the Appellate Tribunal CESTAT New Delhi involved a case where the appellant, engaged in manufacturing Gutkha, faced allegations of clandestinely clearing goods without paying the required duty. The dispute centered around 2404 bags of Gutkha bearing specific brand names, seized at two godowns. The appellant contended that duty on these goods had been paid twice - at the time of clearance and provisional release. However, the adjudicating authority confirmed the duty demand, leading to the appeal.

The Tribunal scrutinized the 22 invoices submitted by the appellant, which lacked details of buyers, raising doubts on their connection to the seized goods. Investigation revealed discrepancies in the clearance and production records, indicating potential manipulation to evade duty. The Tribunal found the appellant's claims unconvincing, especially considering the significant increase in clearance volumes and lack of verifiable consignees for the seized goods.

Citing legal precedents, the Tribunal emphasized the Revenue's burden to establish clandestine activities, not requiring absolute precision but a preponderance of probability. The Tribunal concurred with the adjudicating authority's findings, upholding the decision on clandestine clearance and dismissing the appellant's claims, leading to the dismissal of all appeals. The judgment highlighted the importance of examining the totality of circumstances in cases of duty evasion and clandestine activities, underscoring the need for substantial evidence and adherence to legal standards in such matters.