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of <h1>Tribunal upholds liability, interest, penalties for clandestine removal; Section 11AC benefit maintained despite Revenue appeal.</h1> The Tribunal rejected both appeals, confirming the liability, interest, and penalties on the appellant-assessee for clandestine removal of finished goods. ... Clandestine removal of finished goods - FAA granted benefit of provisions of Section 11AC - Held that:- The proprietor of the firm Shri Vinodbhai T. Patel, in his statement dt.20.03.2007, has accepted that there was clandestine removal & two of the purchasers of the appellants finished goods have categorically admitted that they have received the goods from the appellant under delivery challans and without any invoice. Since there is no retraction of the statements by the proprietor of the assessee and there being corroboration of the receipt of the goods without payment of duty from the assessee from his buyers, the impugned order has correctly upheld the liability on the assessee along with interest and penalties - the assessee should be given the benefit of provisions of Section 11AC of payment of 25% of the duty demanded as penalty if the assessee pays the entire amount of duty liability with interest even at appellate stage well settled in the case of Akash Fashion Prints Pvt. Limited (2009 (1) TMI 113 - GUJARAT HIGH COURT) . Issues:1. Confirmation of demand along with interest and imposition of penalty on appellant-assessee.2. Benefit of provisions of Section 11AC for penalty.3. Clandestine removal of finished goods by appellant-assessee.Confirmation of demand along with interest and imposition of penalty on appellant-assessee:The case involved two appeals against Order-in-Appeal No.SKSS/202-205/DMN/Valsad/2010-11, where the Revenue and the appellant-assessee contested the confirmation of demand, interest, and penalty. The preventive officers found discrepancies in the statutory records and sales invoices of the appellant-assessee, leading to a Show Cause Notice for illicit clearance of goods. The adjudicating authority confirmed the demand, interest, and imposed penalties. The first appellate authority upheld the order for the appellant-assessee and modified penalties for others. The appellant contested the lack of evidence for clandestine clearances, citing relevant case laws. The Revenue argued that the proprietor admitted to clandestine removal. The Tribunal found the proprietor's consistent statements and buyers' admissions sufficient to uphold the liability on the appellant-assessee for clandestine removal.Benefit of provisions of Section 11AC for penalty:The Revenue appealed the first appellate authority's decision to grant the appellant-assessee the benefit of paying 25% of the duty demanded as penalty under Section 11AC. The Revenue argued that the condition precedent for this benefit was absent in this case. However, the Tribunal referenced a High Court decision establishing that the appellant should receive the benefit of Section 11AC even at the appellate stage. Consequently, the Tribunal rejected the Revenue's appeal on this issue.Clandestine removal of finished goods by appellant-assessee:The central issue revolved around the clandestine removal of finished goods by the appellant-assessee. The proprietor's admissions, lack of retractions, and buyers' statements corroborated the clandestine removal. Despite the appellant's defense of lack of evidence and examination of all buyers, the Tribunal found the evidence of clandestine removal compelling. The Tribunal emphasized the importance of the proprietor's unchallenged statements and the buyers' admissions in establishing the liability of the appellant-assessee for clandestine removal. Consequently, the Tribunal upheld the liability, interest, and penalties on the appellant-assessee, concluding that the impugned order was justified.In conclusion, the Tribunal rejected both the appeals filed by the appellant and the Revenue, confirming the liability, interest, and penalties on the appellant-assessee for clandestine removal of finished goods, and upholding the benefit of Section 11AC for penalty payment at the appellate stage.
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