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2019 (4) TMI 639 - AT - Central ExciseClandestine removal - Shortage of raw material and finished goods - no verification at the buyer/supplier’s end conducted by the Revenue - whether the department was right in fastening the duty on account of shortage of the finished goods, and raw material found during the joint stock verification? - Held that:- It was presumed by the department that since the authorised representative and the Director of the noticee have accepted the shortage and also made voluntary payment the clandestine removal is accepted by them and hence no further proof is required to that effect. Ld. AR has relied upon the various decisions, wherein it has been held that once the shortage is accepted, no further proof is required for the clandestine removal of the goods. But we feel that the same cannot be applied in the facts and circumstances of present case because the assessee is never accepted the shortage as claimed by the Revenue but paid the Central Excise duty to avoid further litigation and coercion. The department has not conducted any verification at the buyer/supplier’s end in spite of having complete address with them. The Hon’ble Tribunal in the case of Central Cables Ltd. Vs. CCE, Nagpur [2011 (1) TMI 1011 - CESTAT, MUMBAI] held that stock taking by Revenue officers not considering inputs for manufacture and clearance not entered in statutory records before the stock taking. In this case, though the assessee failed to explain the shortage during the visit of Revenue officers, but they did not admit the same and submitted all information along with reconciliation statement. In absence of corroborative evidence, allegation of clandestine removal was not sustainable assessee was only liable for non-maintenance of statutory record. The allegation of clandestine removal is very serious charge and required to be proved with a tangible evidence and supported by corroborative facts - in the present case, Revenue has failed to conduct the investigation in a full proof manner so as to sustain charge against appellant. Demand not sustainable - appeal allowed - decided in favor of appellant.
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