1995 (11) TMI 153

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....s. 2. Arguing for the appellants, the Ld. Advocate submits that officers of Central Excise initiated certain enquiries against the appellant on the basis of an assessment order passed by the Asstt. Collector of Income Tax, Ludhiana, in 1987. A Show Cause Notice was issued to the appellants requiring them to explain why duty amounting to Rs. 14,71,097/- be not recovered from the appellant under Rule 9(2) of Central Excise Rules read with Section 11A of the Act. Penal action was also proposed. The basis of Show Cause Notice was that the appellants had pledged more stock of oil and vanaspati with the bank than what was shown in their raw-material register and RG-1 and that quantity shown as pledged with the Bank was cleared by the appe....

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....er puts any locks to the stock. The stocks were never in excess of the recorded balance. He submits that it was only to secure more finances that inflated stocks were shown as pledged with the bank. Statement of Sh. Bhatia, which merely describes procedure, cannot be relied upon against them, since what is prescribed in the procedure may not always be followed and in fact, they had desired cross examination of Mr. Bhatia, which was refused. There is no evidence whatever to establish clandestine removal of the goods and merely the fact that excess stocks were shown pledged with the bank for the purpose of securing more funds cannot be made a ground for sustaining the charge of clandestine removal of the goods. In support of his contention he....