Duty demand requires stock verification and document correlation before reliance on statements; matter remanded for fresh adjudication.

Duty demand based mainly on recorded statements could not be sustained without proper verification of the documentary records and stock position. Liability under Notification No. 17/2004-C.E. (N.T.) dated 04/09/2004 required correlation of warehoused goods as on the relevant midnight with duty-paid records, so the factual record needed departmental examination. The matter was remanded to the Commissioner for fresh verification of the stock and documents and for a fresh order after giving the assessee a reasonable opportunity to produce and explain the records.

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Issues: Whether the duty demand based on contrary statements could be sustained without proper verification of the documentary records and stock position, and whether the matter required reconsideration by the adjudicating authority.

Analysis: The demand had been raised primarily on the basis of statements recorded during proceedings, while the relevant stock statements and duty payment records were available for correlation. In the light of Notification No. 17/2004-C.E. (N.T.) dated 04/09/2004, liability depended upon verification of the warehoused goods as on the midnight of 5/6.09.2004 and matching of such stock with the duty paid records. The record therefore required factual examination at the departmental level, with an opportunity to the assessee to produce and explain the documents.

Conclusion: The matter was remanded to the Commissioner for fresh verification of the records and stock co-relation, and for passing a fresh order after granting reasonable opportunity to the assessee.

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