TaxTMI 
TaxTMI 
2017 (10) TMI 494
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....ge quantity of filament yarn than what was required in the manufacture of tooth brushes as recorded in their account of production suggesting in the suppression of the actual quantity of brushes manufactured by them. It was concluded that actual production was no recorded in the statutory records and cleared clandestinely. In these set of facts, a show cause notice was issued to the appellants and adjudication took place, the demand of duty of Rs. 19,62,871/- was confirmed and penalties were imposed on all the appellants. Aggrieved from the said order, the appellants are before me. 3. The ld. Counsel for the appellant submits that no evidence has been produced by the Revenue on record and charge of clandestine has been confirmed against the appellant on standard input output norms which is not applicable to allege clandestine removal. It is his submission that appellant is manufacturer of various types of brushes and they have taken the average metal used is manufacture of brushes without actual ascertainment of uses of input, therefore, the charge of clandestine is not sustainable. He further submitted that relied upon other evidence by the authorities below is that inculpatory....
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.... by the Adjudicating Authority. Moreover, the Knitwear Club, Ludhiana which is an independent body have also stated in their letter dated 19 May, 2005 that in normal course, there is a wastage of around 40% same has also not been considered by the Adjudicating Authority but without bringing any corroborative evidence apart from statement of Shri Baldev Singh demand has been confirmed. Such a situation has been dealt by this Tribunal in the case of Klene Paks Ltd. v. CCE, Bangalore-I (supra), wherein the facts of the case are as under :- "2. The relevant facts that arise for consideration are appellant-company herein are manufacturers of HDPE/PP, woven fabrics, sacks. The appellant-company availed Cenvat credit of the duty paid on HDPE/PP granules purchased from various manufacturers like M/s. GAIL; M/s. Reliance Industries Ltd; M/s. HPCL etc. The officers of the DGCEI visited their factory and carried out various investigations. First show cause notice dated 4-7-2003 was issued directing one of the appellant-company herein to show cause as to why the 323 bags of plastic granules seized in the godown of M/s. Mahalakshmi Plastics be not confiscated. Further, investigations w....
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....asis of findings of fact recorded by the Tribunal upon appreciation of the evidence on record, it is apparent that except for the shortage in raw material viz., HD which was disputed by the assessee and the statement of the Director, there was no other evidence on record to indicate clandestine manufacture and removal of final products. On behalf of the revenue, except for placing reliance upon the statement of the Director recorded during the course of the search proceedings, no evidence has been pointed out which corroborates the fact of clandestine manufacture and removal of final products. In the circumstances, on the basis of the material available on record, it is not possible to state that the Tribunal has committed any legal error in giving benefit of doubt to the assessee". and thereafter the Hon'ble Gujarat High Court has held that the confessional statement of an accused in criminal offence which cannot be par with the statement recorded during preventive checks, therefore, the Hon'ble High Court has set aside the charge of clandestine removal. 9. We also find that in the case of Mahavir Metals Industries v. CCE & Cus., Daman, Vapi (supra), this Tribunal furt....
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.... the appellant assessee had, in fact, manufactured the final products out of the inputs detected short on the calculation of input-output ratio. I find that as correctly pointed out by the ld. Counsel that this Bench in the case of Suzlon Fibres Pvt. Ltd. (supra), in Para 3 has categorically stated as under : "3. We agree with the above contention of the ld. Advocate, apart from the input-output ratio, there is no evidence on record to show clandestine manufacture and clearance of the goods. Such cases are required to be established beyond doubt on the basis of concrete and positive evidences. We accordingly set aside the impugned order and appeals are allowed with consequential relief." 17. My view as regards there cannot be allegation of clandestine removal unless there is an evidence to indicate that there was clandestine manufacturing, is fortified by the judgment of Hon'ble High Court of Gujarat in the case of Nissan Thermoware Pvt. Ltd., wherein their Lordship have held as under : "7. Thus, on the basis of findings of fact recorded by the Tribunal upon appreciation of the evidence on record, it is apparent that except for the shortage in raw material viz.....