2014 (9) TMI 243 - ALLAHABAD HIGH COURT

Clandestine removal of goods - Illegal sale of portland cement - Penalty u/s 11AC - first appellate authority deleted the addition and cancelled the penalties - Tribunal restored addition and penalties - Held thta:- No investigation was made by the Department, even the consumption of electricity was not examined by the Department who adopted the short cut method by raising the demand and levied the penalties. The statement of so called buyers, namely M/s Singhal Cement Agency, M/s Praveen Cement Agency; and M/s Taj Traders are based on memory alone and their statements were not supported by any documentary evidence/proof. The mischievous role of Shri Anil Kumar erstwhile Director with the assistance of Accountant Sri Vasts cannot be ruled out - when there is no extra consumption of electricity, purchase of raw materials and transportation payment, then manufacturing of extra goods is not possible. No purchase of raw material out side the books have been proved. no case is made out for extra so called clandestine sale of the Portland Cement to the said parties - Decided in favour of assessee.