2002 (11) TMI 161 - AT - Central Excise

Summary

Issues involved: Appeal against decision of Collector of Customs and Central Excise confirming duty, imposing penalty and fine, and confiscating property based on clandestine removal of goods without payment of duty.

Confirmation of duty: The appellant was charged with clandestinely removing goods without payment of duty. The adjudicating authority confirmed duty of Rs. 1.34 lakhs based on evidence of synchronisation between private and statutory records. The Commissioner held that the department failed to provide corroborative evidence for the excess receipt of grey fabrics, leading to dropping of charges for a major portion of the duty. However, the Commissioner found sufficient evidence to establish that certain grey fabrics were illicitly manufactured and removed without duty payment, totaling 91,081 L. Mtrs valued at Rs. 18,45,037.43.

Penalty and fine: The Delhi High Court and Supreme Court rulings established that penalty and fine cannot be imposed for violation of the Additional Duties of Excise Act under the Central Excise Act. Therefore, the portion of the order imposing penalty and fine was set aside.

Legal arguments: The appellant's counsel argued for following specific parameters in confirming duty, citing various Tribunal judgments. The counsel emphasized the need for proof beyond reasonable doubt in cases of clandestine removal, but the Tribunal held that preponderance of probabilities suffices in such cases. The burden of proof was deemed to shift to the manufacturer to explain the existence of private records, which were considered as incriminating evidence.

Decision: The appeal was dismissed concerning the confirmation of duty, while the appeal regarding penalty and fine was allowed. The appellant's appeal was disposed of accordingly.