2020 (7) TMI 53 - CESTAT NEW DELHI - Central Excise

Head Note / Extract:
Clandestine removal - sponge iron - shortage in stock of coal and sponge iron - no corroborative evidences - HELD THAT:- From the show cause notice, it is observed that existence of weighbridge is admittedly within the factory premises. The weighbridge slips are considered as one of the important documents by the adjudicating authorities below providing the alleged clandestine removal. Once the weighbridge exists within the factory premises, the factum of clearance of goods from said weighbridge does not at all arise. This observation is sufficient to hold that weighbridge slips cannot be the evidence for proving that the goods were cleared from the appellant’s factory clandestinely. The weighbridge being within the factory premises, the weighment of any commodity or any entry in outgoing register from the said weighbridge cannot reflect clearance at all. The shortage is alleged on the basis of an estimate weighment of sponge iron the estimation cannot take place of evidence. Specially, when there is no investigation as to where from the noticed excess inputs were sourced so as to manage such excess clearances. No investigation as regard electricity excess usage. No third party investigation as regards transporters buyers etc. Above all, no attempt to track any money trail as alleged. Law has been settled that where the allegation of duty. To prove the allegation of clandestine sale, further corroborative evidences are also required. Apparently, there is no investigation conducted by the Department qua any of said aspects. Alleged admission of Shri Devi Lal Sahu - HELD THAT:- The statement contains only a declaration to comply with the law. It cannot be taken as an admission of any clandestine removal. Question of the said statement to be the corroboration of the alleged guilt does not at all arise - in the absence of direct admission of clandestine removal the mere fact of the shortage found cannot sustain the charge of clandestine manufacture and removal. Accordingly the confirmation of demand is merely presumptive hence, not sustainable. The adjudicating authority below has based the decision on assumptions and surmises and in total ignorance of the documents and submissions produced/made by the appellant. Those documents and the facts submitted are sufficient to falsify the allegations - appeal allowed - decided in favor of appellant.