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of <h1>Tribunal Reverses Order, Grants Appeals, Stresses Evidence</h1> <h3>Kalindi Ispat Pvt. Ltd. Versus CCE., Raipur </h3> The tribunal overturned the impugned order, allowing all three appeals and providing consequential relief to the appellants. The judgment emphasized the ... Clandestine removal of goods - sponge iron - Discrepancy in stock found - Goods cleared without payment of duty - Held that:- Dip reading method adopted by the officers lead to wrong assessment of weight of the sponge iron and the allegation of the clandestine removal cannot be upheld against the assesee. In any case, such shortages detected by the officers come to only 6.40%, which cannot be held to be abnormal. It is well settled law that shortage itself without any other corroborative evidence, cannot lead to the inevitable conclusion of the clandestine removal - As regards the duty demand of ₹ 4,45,352/- in respect of 158.900 MTs of sponge iron based upon computer printout resumed from the appellant’s factory, it is the appellant submission that the same gives details of clearances to be made by them along with vehicle numbers. Vehicle numbers pertain to the contact transporters in order to confirm availability of vehicle. If vehicle is available, the transporter provides vehicle number which is entered in the computer along with quantity of sponge iron to be dispatched. At times on eleventh hour the vehicle is not made available by the transporters or after arrival of vehicle the order dispatched is cancelled and the vehicles leave the factory but the incoming and outgoing time is recorded. Computer printout and respect of which the appellant has already given explanation there is virtually no evidence on record to show clandestine clearance. I really fail to understand that when vehicle numbers were available with the Revenue, no enquiry was conducted. Further, there is no statement of the buyers or no evidence relatable to the procurement of extra raw materials or receipt of payment from the alleged buyers. In such scenario, allegation of clandestine removal cannot be upheld - Decided in favour of assessee. Issues Involved:Investigation of duty evasion based on shortages and discrepancies in production records, confirmation of duty demand, imposition of penalties on directors, validity of clandestine removal allegations, evidence required for duty confirmation based on statutory records and daily production records.Analysis:The appellant, engaged in sponge iron manufacturing, faced duty evasion allegations after discrepancies were found during a Central Excise officers' visit. Shortages and discrepancies in production records led to duty demands amounting to significant sums. Statements from directors and comparisons of various production records were pivotal in the investigation.The duty demand of &8377; 1,46,568/- was contested by the appellant, claiming the shortages were estimated, not accurately weighed. The method of assessing sponge iron weight through dip reading was deemed unreliable due to the hopper's design, leading to a possibility of errors. The tribunal agreed with the appellant, citing the lack of concrete evidence and the insignificance of the detected shortages as per legal precedents.Regarding the duty demand of &8377; 4,35,352/- based on computer printouts, the appellant explained discrepancies as logistical issues with transporters, not indicative of clandestine activities. The tribunal noted the absence of substantial evidence supporting clandestine clearances, emphasizing the need for buyer statements or procurement evidence to uphold such allegations.The duty demand of &8377; 2,65,606/- stemmed from comparisons between statutory and daily production records. The adjudicating authority accepted the inclusion of sponge iron fine in the RG-1 register, leading to a partial confirmation of the demand. However, without evidence of goods movement, transporter details, or excess payments, the tribunal dismissed the clandestine removal allegations.Ultimately, the tribunal overturned the impugned order, allowing all three appeals and providing consequential relief to the appellants. The judgment highlighted the importance of concrete evidence and adherence to legal principles in confirming duty demands and penalizing parties involved in excise duty evasion cases.
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