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2018 (5) TMI 1300 - AT - Central ExcisePenalty u/r 209A of the Central Excise Rules - Clandestine removal - Cigarettes - demand of duty on on all duplicate bills and entries made - absence or proper evidences - Held that: - during the period February, 1989 to March, 1992, all the franchisee units were under the strict physical control and supervision of the Excise Department who also maintained their own record. The impugned order or the show cause notice is silent on this aspect. The assessee-Appellants had repeatedly requested for production of diary XT-I which was never produced - the Department has not verified suppliers’ bills or the purchasers’ bills. No evidence was collected to adjudicate the clandestine removal of the goods which were transported and sold. The bank officers accepted that the bills were discounted without any physical verification of the goods - all the transactions of the bill discounting were duly recorded in the books of account of both the parties. The assessee-Appellants has committed a fraud with the Banks by raising the duplicate bills. For this financial irregularity, Department will be at liberty to initiate appropriate proceedings under the relevant law. But, in the instant case, the goods were not moved and there is no evidence pertaining to the clandestine removal of the goods - For clandestine removal, which is a serious charge, the strict evidence is required like supply of the raw-material, consumption of extra-electricity, transportation of the confiscated goods and sale of the finished goods. Unfortunately, no evidence has been collected by the Department pertaining to these aspects. When there is no clandestine removal, then no penalty can be imposed under Rule 209A of the Rules - penalty set aside - appeal allowed - decided in favor of appellant-assessee.
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