Clandestine removal not proved for moulds and patterns; duty demand failed where in-factory use and notification conditions were accepted.

Duty demand on moulding patterns and moulds was held unsustainable because the record did not prove clandestine removal. The authorities had assumed the items were cleared without utilization, but no finding addressed the assessee's plea that they were manufactured for in-factory use, fully utilized, and later cleared as second-hand goods. On the assessee's version accepted by the Tribunal, the relevant notification conditions were met, so duty could not be demanded on the basis adopted by the lower authorities. The demand was set aside with consequential relief.

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Issues: Whether duty demand on moulding patterns and moulds was sustainable where the assessee claimed that the goods were fully utilized within the factory under the relevant notifications and were cleared only as second-hand items.

Analysis: The record did not substantiate the allegation of clandestine removal. The authorities proceeded on an assumption that the patterns and moulds had been cleared without utilization, but no finding was recorded on the assessee's specific plea that the items were manufactured for in-factory use, fully utilized, and thereafter cleared as second-hand goods. In the absence of proof of clandestine clearance, and since the conditions of the notifications stood fulfilled on the assessee's version accepted by the Tribunal, duty could not be demanded on the footing adopted by the lower authorities.

Conclusion: The demand was not sustainable and the issue was decided in favour of the assessee.

Final Conclusion: The appeal succeeded, and the duty demand was set aside with consequential relief.

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