Clandestine removal proved on total evidence as private records and buyer statements sustained excise duty and penalties.

Private records, buyer statements, weighment slips, stock-related documents and other surrounding material were treated as sufficient to sustain a clandestine removal allegation against the assessees for MS ingots. The defence that some cash entries related to scrap trading or duty-paid clearances failed because no reliable correlation was shown between the disputed entries and lawful transactions, and the absence of formal invoices supported the allegation. Applying the principle that clandestine removal may be established on a preponderance of probabilities from the totality of evidence, CESTAT upheld the demand of central excise duty and the penalties.

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Issues: Whether the demand of central excise duty and penalty could be sustained on the basis of private records, buyer statements, and other surrounding material to hold that the appellants had clandestinely removed MS ingots without payment of duty.

Analysis: The evidence relied upon included private notebooks, recorded receipts from purchasers, weighment slips, stock-related records, and statements of the appellants and buyers. The defence that some receipts related to scrap trading or duty-paid clearances was not accepted because no reliable correlation was established between the disputed cash entries and the claimed lawful transactions. The absence of formal invoices in the disputed transactions, coupled with admissions from buyers and supporting material regarding procurement of raw materials and clandestine activity, was treated as sufficient. In clandestine removal matters, the authority applied the principle that proof need not reach mathematical precision and that the charge may be established on a preponderance of probabilities from the totality of evidence.

Conclusion: The demand of duty and the penalties were upheld.

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