Tribunal Upholds Penalties for Clandestine Removal of Excisable Goods; Evidence Includes Intercepted Items and Testimonies.

The Tribunal upheld the Commissioner's decision, confirming the clandestine removal of excisable goods. Evidence included intercepted goods, undisclosed machines and godowns, and corroborative statements. The company and its director faced penalties of Rs. 30,55,723/- and Rs. 1,00,000/-, respectively, with Rs. 20,00,400/- already appropriated. The appeals were dismissed, affirming the penalties.

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Issues Involved:
1. Interception of tempo carrying excisable goods without duty payment.
2. Discovery of additional running machines and undisclosed godowns.
3. Recovery of loose sheets indicating clandestine removal of goods.
4. Admission of clandestine removal by company officials.
5. Calculation of duty based on evidence and statements.
6. Imposition of penalties on the company and its director.

Detailed Analysis:

1. Interception of Tempo Carrying Excisable Goods Without Duty Payment:
The case began with the interception of a tempo on 19-2-2002, carrying excisable goods (pan masala/Gutka) without evidence of duty payment. This incident triggered further investigations into the activities of the appellants.

2. Discovery of Additional Running Machines and Undisclosed Godowns:
During the investigation, Central Excise Officers discovered that 26 machines were operational, contrary to the appellants' declaration of only 14 machines. Additionally, two undisclosed godowns were found storing excisable goods without evidence of duty payment.

3. Recovery of Loose Sheets Indicating Clandestine Removal of Goods:
Loose sheets recovered from the factory premises showed date-wise removal of "PANKING" brand gutka between 7-1-2002 and 18-2-2002. These sheets were crucial in establishing the clandestine removal of goods.

4. Admission of Clandestine Removal by Company Officials:
The Commissioner concluded that the appellants were engaged in clandestine clearances based on the interception of the tempo, corroborative statements from the Director, Accountant, and Production Supervisor, and the recovery of loose sheets. The appellants had also paid Rs. 20,00,400/- towards duty during the investigation, which supported the claim of duty evasion.

5. Calculation of Duty Based on Evidence and Statements:
The duty calculations were based on evidence collected, including the loose sheets and statements from company officials. The department calculated the duty not on the declared 14 machines but on the actual operational evidence of 26 machines. The details in the loose slips were admitted by all concerned as clearances without duty payment.

6. Imposition of Penalties on the Company and Its Director:
The Commissioner imposed a penalty of Rs. 30,55,723/- on the company and Rs. 1,00,000/- on the Director, appropriating Rs. 20,00,400/- already deposited by the appellants. The penalties were deemed commensurate with the nature of the offence.

Conclusion:
The Tribunal upheld the Commissioner's order, finding ample evidence of clandestine removal of goods. The loose sheets, corroborative statements, and undisclosed operational machines and godowns substantiated the charges. The appeals were dismissed, and the penalties were upheld as appropriate for the offence.

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