TaxTMI 
TaxTMI 
2010 (7) TMI 584
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....confirmed the demand for central excise duty of Rs. 10,42,902.00 on the findings of clandestine removal of the appellant's final product H. Acid and of Rs. 1,48,926.00 on account of clandestine removal inputs and final product. In addition penalty of identical amount stands imposed under Section 11AC of Central Excise Act. Vide the same impugned order Commissioner has dropped the demand for Rs. 51,40,800/- raised against the appellant on the charges of clandestine manufacture and removal of H. Acids as also the demand of Rs. 13,498.00 on account of non-inclusion of freight charges in the assessable value. 2. As per facts on record the appellant herein is engaged in the manufacture of DASA and H. Acid and other goods falling under Chapter....
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....lash Drier Reports' (hereinafter referred as SFDR). Some other records like analysis, note books mentioning the date, shift, lot number, number of bags, purity etc. were also recovered. The statement of the operator Shri Amarbhai P. Thakor and the laboratory chemist, Shri Rameshbhai V. Vekaria were recorded 5. Based upon the above, show cause notice dated 22-3-02 was issued to the appellant. In the present proceedings we are only concerned about the proposal to confirm the demand of duty on the allegations of clandestine removal of the final product, based upon the spin flash drier reports. 6. During the course of adjudication, the appellant pleaded before the adjudicating authority that the figures of production of H. Acid ....
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.... course of adjudication they also pointed out that Annexure-II to the reply dated 17-5-03 shows the invoices of other manufacturers where the "as is" weight, purity and "real weight" are indicated. This clearly shows the prevailing practice in the market i.e. to show only the real weight (i.e. adjustment for 100% purity) as the weight of the manufactured goods. 7. The above plea of the appellant was not accepted by Commissioner on the ground that it is not at all clear as to what was the source of the figures of purity in Annexure-IV of their written reply. Inasmuch as there is a discrepancy between the SFDR and RG 1 entries even after adjustment for purity, the noticee's submission cannot be accepted. Accordingly by observing that ....
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....y for their own convenience. The question which arises is as to whether the said SFDRs, which is a private document, can be made the sole basis for alleging manufacture and clearance of the final product without payment of duty. Apart from the fact that there is no other evidence corroborating the charge, we also note that the difference in the entries made in RG 1 register and SFDR stands explained by the assessee. The entries are made in SFDR immediately on production of H. Acid on the basis of weight "as it is" where as the entries made in RG 1 register is on the basis of '"real" weight of H. Acid, which is based upon the purity. The appellants have contended before Commissioner that the weight get reduced to bring it to 100% purity. The....
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....s give rise to suspicion regarding clandestine removal but would not be sufficient to establish it in the absence of other supporting evidences. The other supporting evidences referred to in various decisions like Resha Wires Pvt. Ltd. v. CCE, Bangalore reported in 2006 (74) RLT 184 (CESTAT - Ban.) = 2006 (202) E.L.T. 332 (Tri. - Bang.) are the consumption of electricity, purchase of excess raw material and purchase of unaccounted goods by the buyer. In the present case we do not find any investigations conducted by the Revenue so as to establish the identity of the buyers, who have purchased the final product. There is also no reference as to how the consideration for the said final product allegedly removed clandestinely was made. I....