2009 (10) TMI 689 - AT - Central Excise

Summary

Issues:
- Duty demand and penalty set aside by Commissioner (Appeals)
- Alleged shortage of raw materials leading to duty demand and penalty
- Lack of evidence presented by Revenue to support the duty demand

Analysis:
1. Duty demand and penalty set aside by Commissioner (Appeals): The Revenue filed an appeal against the Order of the Adjudicating Authority, which was set aside by the Commissioner (Appeals) in relation to duty demand of Rs. 7,66,545.00 and penalty. The case revolved around the alleged shortage of raw materials used in the manufacturing process of Branded Biris, leading to the duty demand and penalty against the Respondent.

2. Alleged shortage of raw materials leading to duty demand and penalty: The Revenue officers visited the factory premises of the Respondent and conducted physical weighment of the stock, revealing a shortage of tobacco and kandi, which are raw materials for biris. The Revenue contended that as these raw materials were found short and used in the production of final products cleared without duty payment, the Respondent was liable for duty and penalty.

3. Lack of evidence presented by Revenue to support the duty demand: The Commissioner (Appeals) noted that the weighment of tobacco and kandi was based on presumptions regarding the weight of each bag, without concrete evidence to prove the actual stock position or the clearance of final products without duty payment by the Respondent. The Tribunal found a lack of evidence from the Revenue to substantiate their claim, highlighting the absence of proof regarding the weighment process and the alleged duty evasion by the Respondent.

In conclusion, the Appellate Tribunal upheld the decision of the Commissioner (Appeals) to set aside the duty demand and penalty imposed on the Respondent. The Tribunal emphasized the importance of concrete evidence to support duty demands, highlighting the lack of proof provided by the Revenue in this case. As a result, the appeal filed by the Revenue was dismissed, and the Cross Objection filed by the Respondent was also disposed of accordingly.