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2017 (6) TMI 901 - AT - Central ExciseClandestine manufacture and removal - shortage of stock - Held that: - The first issue is with regard to shortage of 24.20 MTs found during the conduct of stock taking at the factory on 26.6.2003. Admittedly, there was no physical stock taking and comparison with the statutory record was done by mere eye estimation. It is the department s contention that the ingots manufactured are all regular sizes and therefore mere eye estimation was sufficient for such stock taking. That it was also not practically and logistically possible to get such huge stock weighed. When there is no physical stock taking by weighing the stock, we have to agree with the findings of the Commissioner (Appeals) that no credence can be placed on such eye assumption of the stock. This cuts the root of the department s case as the stock to be compared with the accounts and documents recovered is an assumptive figure. There is no evidence regarding excessive usage of raw materials or consumption of electricity by the respondents. Though the department allege that the respondents have procured excessive raw materials, from the discussions made as above, we have to say that there is no cogent evidence to establish that such huge quantity of raw materials was obtained by them. Consequently, we have to say that the allegation that they removed finished goods clandestinely without payment of duty, also does not sustain. In a large number of cases, it has been held that unless there is clinching evidence to establish clandestine removal, the demand cannot be confirmed solely on the basis of private records. Such private records have to be corroborated by evidence other than statements. Charge of clandestine removal being serious charge, the same has to be proved to a possible extent even though evidence to a mathematical precision may not be possible. Appeal dismissed - decided against Revenue.
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