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2017 (5) TMI 278 - AT - Central ExciseClandestine removal - associated enterprises - goods cleared without accounting in RG-I register and without raising invoices and making payment of duty - Held that: - From the explanation of each record/private entries made by the appellant comparing the entries with the CENVAT invoices leads to a probable conclusion that the private records do not reflect dispatch or clearance of goods per se - there is no evidence of receipt of any excess quantity of raw materials for the alleged excess production which the department alleges to have been clandestinely removed by the appellant. Being bulk drugs/intermediaries the department has to establish the receipt of raw materials for the production of the goods. The raw materials of such specialized products cannot be considered to be easily available in local market. The sellers who supplied the excess raw materials are not in picture. There is no evidence of extra usage of electricity or any evidence for transportation of such clandestinely removed goods. There is no evidence for payment/receipt of money for excess inputs, extra labour and also payments made from the buyers end. In Dekon India Vs CCE, Kolkata-II [2004 (2) TMI 181 - CESTAT, KOLKATA] the Bench held that entries made in the plan diary cannot be basis to conclude that goods have been clandestinely removed. When the department is relying on private entries in some loose sheets/note books, the department has to complete the chain of purchase of inputs to production and removal in respect of the figures found in such private records. It is settled law that allegation of clandestine production and clearance is to be made only when the department has concrete evidence of un-accounted receipt of raw materials, its consumption and un-accounted production. The clandestine clearance has to be supported by evidence of transportation of material and also flow back of cash - there is no evidence to establish clandestine clearance of goods - demand is unsustainable - appeal allowed - decided in favor of appellant.
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