Clandestine removal in excise can be proved by seized records and unretracted statements on a preponderance of probability.

In departmental excise adjudication, confiscation was sustained where 49.960 kgs. of branded chewing tobacco was found in excess of the recorded balance and remained unaccounted in statutory records. Duty demand, interest and penalty were also upheld because seized private records, loose sheets and corroborative statements indicated clandestine removal without payment of duty, and the statements were not retracted. The note reiterates that such allegations may be proved on the standard of preponderance of probability, with unrebutted documentary evidence and admissions sufficient to support adverse findings in excise proceedings.

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Issues: (i) Whether confiscation of 49.960 kgs. of branded chewing tobacco found in excess of recorded balance was justified. (ii) Whether the duty demand, interest and penalty arising from alleged clandestine removals based on seized private records were sustainable.

Issue (i): Whether confiscation of 49.960 kgs. of branded chewing tobacco found in excess of recorded balance was justified.

Analysis: The goods were found in excess of the balance shown in the production register and the allegation of non-accountal was not refuted. The seized quantity of finished chewing tobacco was not accounted for in the statutory records, and the factual foundation for confiscation remained unrebutted.

Conclusion: Confiscation of 49.960 kgs. of branded chewing tobacco was upheld.

Issue (ii): Whether the duty demand, interest and penalty arising from alleged clandestine removals based on seized private records were sustainable.

Analysis: The duty demand rested on bill books, a rent receipt register and loose sheets recovered from the factory, and the statements recorded under Section 14 of the Central Excise Act, 1944 ed that those records related to sales without payment of duty. The statements were not retracted. In departmental adjudication, the applicable standard is preponderance of probability, not proof beyond reasonable doubt, and the surrounding evidence was held sufficient to establish clandestine removal. On that basis, the duty demand, interest and penalty were sustained.

Conclusion: The duty demand under Section 11A(1) of the Central Excise Act, 1944, interest under Section 11AB of the Central Excise Act, 1944, and penalty under Section 11AC of the Central Excise Act, 1944 were upheld.

Final Conclusion: The appeal failed in entirety, and the departmental findings on confiscation, duty evasion, interest and penalty were sustained on the evidence adduced.

Ratio Decidendi: In departmental excise adjudication, clandestine removal and allied consequences may be established on the basis of seized records and corroborative statements on the standard of preponderance of probability, with unretracted admissions and unexplained documentary evidence supporting adverse findings.

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