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2018 (12) TMI 1029 - AT - Central ExciseCENVAT Credit - penalty - Denial on the ground that the entire raw material has not been used in the final product as some part thereof being lost - Held that:- Department has conceded that had the washing process been undertaken by the appellant in its own factory, the entire credit would be available. Accordingly, denial of credit on raw coal is unjustifiable even in view of Rule 14 of CCR, 2004. Clandestine manufacture and removal - unaccounted raw materials - finished goods/ MS billets - penalty - Held that:- As is apparent from panchnama the estimation is based on presumption. There is no other evidence except the statements and the acknowledgement therein though without any retraction to prove the alleged shortage. Above all, Mr. Gopal Bordya is the third person as far as the Company as well as its Directors is concerned. The allegations of clandestine removal are serious. The law i.e. as to whether the third party records can be adopted as an evidence for arriving at the findings of clandestine removal, in the absence of any corroborative evidence, is well established - Once this is the situation, irrespective that the Central Excise duty as demanded stands paid, but the fact remains is that there is no evidence for alleged shortage. Mere statement as relied upon is highly sufficient. Also that the same has been paid well before the issuance of SCN. Resultantly, proviso to Section 11AC of the Act is applicable vide which the appellant was liable to pay the penalty only to the extend to 25% of the Central Excise duty involved. Penalty as imposed upon The Directors - Held that:- Though the Directors have been alleged to have not disclosed the facts and alleged short receipt of input to the Department which came to the notice of Department only at the time of visit but in view of above discussions, the cenvat credit as was denied by the Department on the input of the appellant, has been allowed, no mensrea of tax evasion can be attributed to the appellant Directors - keeping in view that the alleged short payment of Central Excise duty since has been paid by them and has not been demanded back, there is no infirmity in imposition of penalty upon the Directors - penalty upheld. Appeal allowed in part.
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