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2018 (6) TMI 1597 - AT - Central ExciseClandestine manufacture and removal - Sugar and Molasses - yield ratio for the Sugar seasons 2002 – 03 and 2003 – 04 to the cane crushed during the financial years 2002 – 03 and 2003 – 04 - HELD THAT:- The reporting periods for the Sugar seasons 2002 – 03 and 2003 – 04 vis-à-vis the financial years 2002 – 03 and 2003 – 04 are not straight jacket comparable as the Appellant had also produced Sugar and Molasses during the period April and May 2003 which got covered by Sugar season 2002 – 03 although, falling within the financial year 2003 – 04. Therefore, the financial year 2003 – 04 comprised of two Sugar seasons i.e. 2002 – 03 (covering April 2003 and May 2003) and 2003 – 04 (covering December 2003 to March 2004). Hence, the findings of the Learned Commissioner are flawed in so far as he held that the production of Sugar/Molasses took place only during October to March, which was common to both the reporting periods. The burden of establishing clandestine removal is on the revenue and in the instant case the revenue has failed to adduce any positive evidence in support of the charge as entire demand is based on a theoretical calculation and inference drawn out of an incorrect application of the yield ratio -The Fact that Sugar and Molasses are controlled products and the production/clearance is strictly regulated also cannot be lost sight of. It is unimaginable that surreptitious production and clearance of the quantity confirmed by the Order-in-Original would have gone unnoticed or not invited any proceedings from other regulated authorities. The revenue fails to discharge the burden of establishing clandestine removal - appeal allowed - decided in favor of appellant.
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