1997 (7) TMI 409 - AT - Central Excise

Summary

Issues:
Demand of duty in respect of Iron and Steel products manufactured and cleared without payment of duty during a specific period.

Analysis:
The appeal in question pertains to the demand of duty concerning Iron and Steel products manufactured and cleared without payment of duty during a particular period. Central Excise officers discovered discrepancies in the production records of the appellant's unit, leading to the identification of unrecorded production. Statements from individuals involved confirmed the existence of excess production not reflected in official records. Subsequently, a duty demand of Rs. 5,21,826/- was imposed, along with a penalty of Rs. 50,000/- under relevant Central Excise Rules.

The appellant's representative argued that evidence of excess production was limited to a specific period, and any duty demand should be based solely on the production reflected in the bundling book. Reference was made to previous tribunal decisions emphasizing the need for reliable evidence to establish clandestine removal of goods. The appellant contended that the demand was speculative and lacked concrete evidence, citing specific cases to support this argument.

On the other hand, the department's representative supported the lower authority's decision, highlighting corroborative evidence such as statements from involved parties and the consistency in the production pattern. Reference was made to legal precedents where statements supported by relevant documents were deemed reliable in establishing clandestine activities. The department argued that the evidence pointed towards the clandestine removal of goods by the appellants.

After considering both sides' arguments, the tribunal found that the department's case was supported by entries in the bundling book and statements from involved individuals. The tribunal noted the lack of challenge to the authenticity of the entries and the unchallenged statement of the labor contractor. It was observed that the appellant had engaged in clandestine activities, as evidenced by the unrecorded production and removal of goods without duty payment. The tribunal rejected the appellant's argument regarding the reliability of the entries and upheld the lower authority's decision on the duty demand. The penalty imposed was deemed appropriate given the circumstances.

In conclusion, the tribunal upheld the lower authority's decision regarding the duty demand and penalty, dismissing the appeal based on the firm basis established for the clandestine removal of goods by the appellants. The tribunal found no fault with the lower authority's order and deemed the penalty amount reasonable in the context of the case.