Clandestine manufacture and removal allegation - substantial...

Clandestine manufacture and removal allegation - substantial electricity consumption cited as evidence - no other corroborative evidence found - Revenue failed to rebut appellant's claims - penalty imposed on Director. Held: Search commenced suddenly without notice, no chance for appellant to hide evidence. No raw materials, consumables, in-process or finished goods stocks found or recorded in Panchanama. Panchanama did not indicate manufacturing activities noticed during surprise visit. Revenue claimed six trucks carried finished goods, appellant countered they carried scrap from Kilns fabrication and installation. No clarity on when CPU was seized and whether Panchanama prepared for it, raising doubts on veracity of Revenue's claims based on emails. Retraction of initially recorded statements by appellant's officers. Electricity consumption attributed to Kilns fabrication and installation by appellant, Revenue did not provide detailed analysis to negate it. Proceedings based on presumptions and assumptions without proper corroborative evidence. Revenue failed to fortify claims despite appellant's satisfactory answers, shifting onus. Appeal allowed on merits. Penalty on Director set aside as confirmed demand unsustainable against main appellant. Impugned order set aside, appeal allowed.