Clandestine removal demands fail without corroborative evidence; private records and higher power consumption alone are insufficient.

Clandestine manufacture and removal of excisable goods cannot be sustained on weighbridge slips, private worksheets and statements alone when they are not statutory records and are unsupported by transport documents, buyer evidence, proof of raw material receipt, proof of clearance, or other corroboration. The Revenue must establish a tangible link between manufacture, removal, transport and sale through affirmative evidence, and mere probability is insufficient. Higher electricity consumption by itself is only an ancillary circumstance and cannot confirm duty liability without corroborative proof of actual production and removal. The major duty demands were therefore not sustainable, and the Revenue appeals were rejected.

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Issues: (i) Whether the Revenue proved clandestine manufacture and removal of excisable goods on the basis of weighbridge slips, private worksheets and statements. (ii) Whether higher power consumption by itself could sustain the duty demand.

Issue (i): Whether the Revenue proved clandestine manufacture and removal of excisable goods on the basis of weighbridge slips, private worksheets and statements.

Analysis: The demand was founded mainly on weighment slips obtained from third-party weighbridges, private records of bill traders and statements of brokers and other persons. The Tribunal found that the slips were not statutory documents, did not by themselves identify the manufacturer or the movement of goods, and were not supported by transport records, buyer evidence, proof of receipt of raw materials in the factory, proof of clearance of finished goods, or corroborating material from the assessees' premises. In the absence of such direct and affirmative evidence, clandestine removal could not be inferred merely from probability or private papers.

Conclusion: The Revenue failed to establish clandestine removal, and the duty demand on this basis was not sustainable.

Issue (ii): Whether higher power consumption by itself could sustain the duty demand.

Analysis: The Tribunal held that electricity consumption was only an ancillary circumstance and not the foundation of the demand. It reiterated that power consumption may vary for several reasons and cannot, without corroborative evidence of actual production and removal, constitute the sole basis for confirming excise duty liability.

Conclusion: Higher electricity consumption did not justify the demand in the absence of corroborative evidence.

Final Conclusion: The impugned orders dropping the major demands were upheld, and the Revenue appeals were rejected.

Ratio Decidendi: In cases of alleged clandestine manufacture and removal, excise duty cannot be sustained on assumptions, probability, private records or electricity consumption alone, and the Revenue must establish the charge with tangible, corroborative and affirmative evidence linking manufacture, removal, transport and sale.

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