Clandestine clearance and non-compliance with excise procedure justified rejection of belated verification and sustained duty demand.

Admissions by the manager and director, supported by documentary evidence, showed that finished excisable goods were cleared without payment of duty. The out-going gate passes and duty-paid invoices did not match, including differences in dates, and the required declaration was not filed at the relevant time. As the procedural requirements under Rule 173H of the Central Excise Rules, 1944 were not complied with, the claimed verification was rejected and the Tribunal's findings sustaining the duty demand were upheld.

---

---

Issues: Whether the assessee could avoid the demand of duty on finished excisable goods cleared without payment of duty, and whether the invoices produced against Out-going Gate Passes could be accepted despite non-compliance with the prescribed procedure.

Analysis: The appeals turned on categorical admissions made by the Manager and the Director, supported by documentary evidence, that finished excisable goods had been cleared without payment of duty. The Out-going Gate Passes and duty-paid invoices did not tally, and their dates also differed. The claimed verification could not be entertained because the necessary declaration had not been filed at the relevant time. The procedural requirements under Rule 173H of the Central Excise Rules, 1944 were not satisfied, and the Tribunal's findings were therefore sustained.

Conclusion: The issue was decided against the assessee and in favour of the Revenue.

Final Conclusion: The High Court upheld the Tribunal's order and rejected the assessees' challenge, leaving the duty demand and adverse findings intact.

Ratio Decidendi: Admissions supported by documentary evidence, coupled with failure to comply with mandatory procedural requirements, are sufficient to sustain the finding of clandestine clearance and rejection of belated verification.

---