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2016 (3) TMI 195 - AT - Central ExcisePenalty under section 11AC - clearance against the dummy challan - clandestine removal - Held that:- The appellant though required to pay the duty/CENVAT Credit which they have already paid, they are not liable to be visited with harsh penalty under section 11AC of Central Excise Act, 1944. In the case of alleged clearance against the dummy challan dated 17.01.2007, find force in the contention of the appellant that in absence of any evidence to the effect that the goods mentioned in the said challan were cleared, the duty mentioned therein cannot be fastened on them. Serious lapse in the investigation undertaken by the officers in making necessary enquiry about the said dummy challan, so as to ascertain whether the goods mentioned in the said challan were in fact cleared to the consignee mentioned in the said challan or otherwise. Also, from the statements recorded, find that nowhere the said question was asked to the Manager or the Director by the investigating officer. In these premises, it is difficult to hold that the goods mentioned in the said challan dated 17.01.2007 were cleared clandestinely without payment of duty. Further, find that penalty was imposed under section 11AC of Central Excise Act, 1944 by the adjudicating authority and confirmed by the Ld. Commissioner (Appeals). Penalty was not confirmed under any other provision nor also invoked in the show cause notice. Accordingly, confirmation of penalty cannot be sustained. The Revenue s Appeal is thus partly allowed to the extent of confirmation of duty on the shortages in the stock of finished goods and raw materials amounting to ₹ 13,38,012/- and the impugned order is modified accordingly. - Decided in favour of revenue in part
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