Shahi Exports Pvt. Ltd vs C.C.E. & S.T., Ghaziabad
- CitationExcise Appeal No.E/3006/2012-EX [SM]
Ratio decidendi
The rule this decision rests on
Where a shortage of excisable goods is detected against recorded stock, the mere admission of that shortage by the authorized signatory does not, without more, establish clandestine removal; the charge cannot be sustained solely on the basis of the shortage detected during verification of documents, and the burden lies on the Department to prove clandestine removal by evidence, which it failed to discharge.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Order-in-Appeal No.125-CE/GZB/12 dated 29.06.2012 passed by the Commissioner (Appeals), Customs, Central Excise and Service Tax, Ghaziabad]
For approval and signature:
HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3 Whether Their Lordships wish to see the fair copy of the Order?
4 Whether Order is to be circulated to the Departmental authorities?
Shahi Exports Pvt. Ltd. Appellant
Vs.
C.C.E. & S.T., Ghaziabad Respondent
Present for the Appellant : Shri.B.Parameswaran, Auth. Rep.
Present for the Respondent: Shri.R.K.Mishra, D.R.
Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)
Date of Hearing/Decision: 27.08.2015
FINAL ORDER NO.54153/2015
PER: S.K. MOHANTY
The brief facts of the case are that the appellant is engaged in the manufacture and processing of fabrics. On 19.07.2002 the officers of Central Excise Preventive Branch, Meerut visited the factory premises of the appellant and during the course of verification, found shortage of the excisable goods as compared to the recorded stock balance. Based on the investigation report, the Show Cause Notice dated 24.12.2003 was issued to the appellant by the Central Excise Department alleging that excisable goods were removed by them without payment of duty of excise and without maintaining proper records. The show cause notice was adjudicated vide order dated 30.03.2004 confirming the demand of duty of Rs.1,65,339/- alongwith interest and imposing equal amount of penalty. In appeal, the ld. Commissioner (Appeals) vide order dated 09.07.2004 has allowed the appeal filed by the appellant on the ground of limitation without going into the merits of the case.
2. Feeling aggrieved with the said order dated 09.07.2004, the Revenue has filed the present appeal before this Tribunal, which was disposed of vide Final Order dated 20.03.2008, allowing the appeal by way of remand to the adjudicating authority, with direction to examine the retraction of statement by Shri Dilip Kumar, the Authorized Signatory. Pursuant to the remand direction, the Original Authority vide order dated 31.12.2010 has again confirmed the demand. In appeal, the Commissioner (Appeals) vide the impugned order dated 29.06.12 has upheld the adjudication order. Hence, this present appeal before this Tribunal.
3. Shri V.Parameswaran, ld. Authorized Representative for the appellant submitted that the authorized signatory of the appellant has only admitted shortage of the finished goods and nowhere in the statement he has stated that the finished goods found short, have been clandestinely removed from the factory. He further submitted that no evidence has been brought on record to prove that the goods have been clandestinely removed from the factory. To corroborate his stand that duty demand cannot be sustained in the absence of any proof regarding clandestine removal of goods, the ld. Consultant has relied on the decision of this Tribunal in the case of Commissioner of Central Excise vs. Rolls Tubes Ltd. reported in 2011 (265) ELT 414 (Tri.-Del.).
4. On the other hand, Shri R.K.Mishra, the ld. D.R. appearing for the respondent reiterated the findings recorded in the impugned order.
5. I have heard the ld. Counsel for both sides and perused the records.
6. I find that the Revenue in this case has not brought out any evidence corroborating their stand regarding clandestine removal. The only contention of Revenue is that the authorized signatory has admitted the shortage. Since the authorized signatory nowhere in his statement had admitted about the clandestine removal of goods, the charges cannot be levelled solely on the basis of shortage detected by the officers during the course of verification of the documents. In view of above, I am of the opinion that the onus lies on the Department to prove clandestine removal of goods, which has not been satisfactory discharged. Therefore, I do not find any merit in the impugned order, and thus, the appeal filed by the appellant is allowed.
[Operative portion pronounced in the Open Court]
(S.K. MOHANTY)
MEMBER (JUDICIAL)
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