Tribunal requires corroborating evidence beyond entries in register to establish clandestine removal

The Tribunal held that the Revenue failed to establish the charge of clandestine removal despite producing evidence, as the respondent denied the allegations and raised doubts on the reliability of the evidence. The Tribunal emphasized the need for corroborating evidence beyond entries in a register, questioning the lack of further verification from buyers. Consequently, the Tribunal set aside the order and allowed the appeal in favor of the Revenue, dismissing the appeal due to the absence of a substantial question of law.

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Issues involved: The issues involved in the judgment are whether the Tribunal was justified in holding that the Revenue failed to establish the charge of clandestine removal despite producing sufficient evidence, and whether the Tribunal was justified in holding that the Revenue was required to conduct further verification from the buyers of the goods when there was already evidence available to establish the charge of clandestine removal.

Issue 1: Revenue's failure to establish clandestine removal

The appellant-Revenue argued that they had discharged the onus to prove clandestine removal of goods, citing evidence such as statements from a Director, watchman, and driver. However, upon review of the Order-in-Original, it was found that the respondent-assessee had denied the allegations made by the Revenue. The Director stated that his statement was recorded under coercion, casting doubt on the reliability of the evidence presented by the Revenue.

Issue 2: Requirement for further verification

The Tribunal based its decision on the entries in a register maintained by the security staff at the factory gate. It was emphasized that such entries cannot solely uphold the charge of clandestine removal without corroborating evidence. Citing established law, it was noted that charges of clandestine removal must be proven beyond doubt with sufficient and affirmative evidence, not assumptions. The Tribunal questioned why the Revenue did not conduct further verification from buyers or purchasers, despite details being available in the register. Due to the lack of further investigation, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant.

The Tribunal's findings were based on an appreciation of the evidence on record, leading to the dismissal of the appeal as no substantial question of law was identified.

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