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of <h1>Tribunal overturns duty demand & penalty citing lack of evidence</h1> <h3>RISHAB REFRACTORIES PVT. LTD. Versus COMMISSIONER OF C. EX., CHANDIGARH</h3> The Tribunal allowed the appeal, setting aside the duty demand and penalty imposed by the Additional Commissioner of Central Excise & Customs. It held ... Clandestine removal Issues:The appeal challenges an order passed by the Additional Commissioner of Central Excise & Customs, Chandigarh regarding the valuation of clearance of goods by the appellants under Chapter 69 Central Excise Tariff Act, 1985, leading to a demand for duty and imposition of penalty.Valuation of Clearance:The appellants declared the value of clearance of goods under Rule 174 of Central Excise Rules as Rs. 4,86,163.25, later obtaining a Central Excise Licence upon reaching the limit of Rs. 10 lakhs. Central Excise Officers found discrepancies in sales figures furnished to different departments, leading to a demand for duty of Rs. 1,96,875.40 on the sale of Rs. 38,51,620.75. The Additional Commissioner confirmed the duty demand and imposed a penalty of Rs. 50,000 under relevant rules.Legal Arguments:The appellants contended that the figures submitted to the Industries Department were inflated to secure a higher coal quota due to scarcity, and cannot be solely relied upon for duty assessment. Citing a Tribunal decision, it was argued that such declarations do not constitute sufficient evidence for clandestine removal of goods. The Department's case lacked corroborative evidence beyond the inflated figures provided.Analysis and Decision:The Tribunal considered the officer's verification of sales figures for a limited period and the appellants' claim that actual sales were reflected in Central Excise records and tax returns. The Department possessed relevant documents for verification but failed to establish the clandestine removal of goods conclusively. Referring to legal precedents, the Tribunal held that the Department's reliance on inflated figures without substantial proof was unjustified. The demand for duty and penalty was deemed unsustainable and set aside, allowing the appeal.
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