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2006 (11) TMI 376 - CESTAT, AHMEDABADClandestine removal of manufactured goods - Demand and penalty - kachcha/pakka grey challans recovered along with the two note books - Statement of the 22 merchant -manufacturers recorded - Retracted statement - corroborative evidences - grey fabrics for processing - HELD THAT:- We find that the Revenue has been able to discharge its burden to prove clandestine manufacture and removal of excisable goods. The appellants claim that corroboration in the shape of installed capacity, electricity consumption, labour employeed etc., has not come on record, does not convince us inasmuch as it is the sufficiency of evidences on record which has to be considered and the Revenue cannot be expected to prove its case by producing direct evidence which would rarely be forthcoming. It is not necessary that the case of the clandestine removal must always be proved by referring to electricity consumption or installed capacity or labour employeed etc. We find that M/s. Montex Dyeing & Printing Works is not disputing the recovery of challans/note books from its premises. The said entries finds sufficient corroboration in the shape of the statement of the partner and the merchant- manufacturer, which we have dealt in details in the preceding paragraph. As such, we hold that the charge of clandestine removal against the said appellants stands established. Accordingly, duty of Rs. 24,70,054/- confirmed against the said appellants is upheld. However, in the facts and circumstances of the case, we reduce the penalty imposed upon the said appellants to Rs. 15.00 lakhs (Rupees fifteen lakhs only). We also note that the confiscation of the land, building, plant and machinery was not justified. The same is accordingly set aside along with setting aside of redemption fine of Rs. 25,000/-. Penalty on Shri Manharlal, partner of the mill under the provisions of Rule 209A is reduced from Rs. 2.00 (Rupees two lakhs only) to Rs. 1.00 (Rupees one lakh only). As regards penalties imposed upon the other appellants, Shree Swastik Silk Mills and M/s. Ruchi Silk Mills, under the provisions of Rule 209A of the Central Excise Rules, we find that the said appellants admittedly send the grey fabrics under katchcha challans and received the processed fabrics back from M/s. Montex Dyg & Ptg Works without payment of duty and without the cover of any Central Excise invoices. As such, it can be safely concluded that not only they were aware of evasion of duty by the processor but were also a party to the same by activity and knowledgebly participating in the clandestine activities and dealing with the offended goods, thus attracting penalty under Rule 209A. As the quantum of penalty on them is only to the extent of Rs. 6,000/- + Rs. 24,400/-, we are not inclined to interfere in the quantum. Their appeals are accordingly rejected. All the four appeals are disposed of in the manner indicated above.
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