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of <h1>Appellate Tribunal rules in favor of appellant in clandestine goods removal case, emphasizing burden of proof.</h1> <h3>M/s Saraya Sugar Mills Versus Commissioner, CGST & Central Excise, Varanasi</h3> The Appellate Tribunal CESTAT ALLAHABAD ruled in favor of the appellant in a case involving alleged clandestine removal of goods based on detected ... Clandestine removal - shortage of stock - sugar - HELD THAT:- The appellant had taken a categorical stand that the stock of sugar got damaged due to seepage from the roof which plea stands rejected by the Lower Authorities as an afterthought. Apart from the shortages, there is no evidence of removal of the goods in a clandestine manner. The clandestine allegations are required to be established by the Revenue by production of sufficient evidences. The discrepancies in the stock cannot be taken as a ground for upholding the allegations of clandestine removal. In the present case, there is no admission of any clandestine removal by the appellant. Further, there is no evidence of transportation of the goods, receipt of the goods by the customers or receipt of the consideration by the appellant. In such a scenario, the confirmation of demand of duty cannot be upheld - appeal allowed - decided in favor of appellant. Issues: Alleged clandestine removal of goods based on shortages detected during factory visit, confirmation of demand, imposition of penalty.In the judgment delivered by Hon'ble Mrs. Archana Wadhwa, Member (Judicial) of the Appellate Tribunal CESTAT ALLAHABAD, the case involved a factory engaged in sugar manufacturing where shortages of 6,084 bags/Qtls of sugar were detected during a visit by officers. The appellant's authorized signatory admitted the shortages and agreed to deposit central excise duty, which was done by the appellant subsequently. Proceedings were initiated against the appellant, leading to a show cause notice and an order confirming the demand, interest, and penalty, upheld by the Commissioner (Appeals), prompting the present appeal.The Revenue alleged clandestine removal of sugar based on the detected shortages, while the appellant claimed the stock was damaged due to seepage from the roof, a plea rejected by lower authorities. The judgment highlighted the necessity for the Revenue to establish allegations of clandestine removal with sufficient evidence, emphasizing that discrepancies in stock alone cannot support such claims. Legal precedents were cited, including decisions by the Hon'ble Allahabad High Court and the Hon'ble Punjab & Haryana High Court, emphasizing that mere shortages do not prove clandestine removal.The judgment noted that there was no admission of clandestine removal by the appellant, no evidence of transportation or receipt of goods by customers, or receipt of consideration. Consequently, the confirmation of duty demand was set aside, and the appeal was allowed with consequential relief to the appellant. The judgment was pronounced in open court on 08/01/2020.
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