TaxTMI 
TaxTMI 
2005 (5) TMI 411
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....t unaccounted for the purpose of removal without payment of duty. It appeared from further investigations that during 1996-97, the appellants had suppressed production and clearance of 431 bags of cotton yarn valued at over Rs. 18.00 lakhs, with intent to evade payment of duty. Statements were recorded from the Managing Director of the appellant-company as well as certain persons to whom the said clearance was allegedly made. The appellant paid duty of Rs. 19,941/- on 4080 Kgs. of yarn which had admittedly been cleared without payment of duty. Show cause notices were issued to the party for confiscating the seized yarn, demanding duty on cotton yarn allegedly cleared without payment of duty in 1996-97 and for imposing penalty. The notices w....
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....ing that, had the officers taken into account the production of yarn for 14th and 15th of June 1998, they would not have found any excess stock of yarn. According to ld. Counsel, even otherwise, the mere presence of excess stock of goods did not mean that it was kept for clandestine removal. Counsel also considered the redemption fine of Rs. 10,000/- to be exorbitant. Ld. DR countered these submissions by relying on the following decisions : (i) Jagdamba Spinning & Wvg. Mills v. CCE - 2000 (115) E.L.T. 353 (ii) Kumar Industries (MSD) v. CCE - 2000 (124) E.L.T. 217 (in) CCE v. Decora Tubes Ltd. - 2002 (146) E.L.T. 703 (iv) Forech India Ltd. v. CCE - 2004 (175) E.L.T. 203 (v) Ra....
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.... conclusive evidence of clandestine removal of the goods by the appellants. When the middleman was missing, it was the necessary evidentiary link that was missing. Therefore, I am of the considered view that there is no sufficient evidence in this case to record a finding that the appellants had clandestinely removed 431 bags of cotton yarn through Shri Paramasivam to the so-called buyers. The demand of duty is therefore unsustainable. It appears from the orders of the lower authorities that the penalty on the appellants is in relation to clandestine removal of goods. Now that the finding of clandestine removal, entered by the lower authorities, stands rejected, there is no scope for any penalty on the appellants. However, as regards 666.37....