Whether clandestine removal can be said to be proved on mere admission of Manager that there is shortage?

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SOY P ITTY on 21 Apr, 2016 wrote:

YOU SIR IS A GREAT PERSON TO SERVE WITH OUT ANY SINGLE PENY. AND YOUR ADVICE RELATED EXCISE AND SERVICE TAX IS VERY VALUABLE FOR GRADUATE/POST GRADUA ...
hitesh on 03 Apr, 2016 wrote:

THANK U SIR 4 UR REPLY ON RATE OF INTEREST
hitesh on 20 Mar, 2016 wrote:

Thank u sir for ur reply regarding ssi exemption limit.
visuiyer on 09 Mar, 2016 wrote:

the budget analysis is really superb... and has highlighted all the aspects.. Hats off Sir ji..
hitesh on 06 Mar, 2016 wrote:

THANK U SIR FOR YOUR REPLY REGARDING THE TARIFFS I ASKED
hitesh on 29 Feb, 2016 wrote:

THANK U SIR FOR GUIDING ME IN THE QUERY OF REFUND.I M THANKFULL TO U.
Abhimanyu Singh on 08 Feb, 2016 wrote:

GST should be passed in this budget. all parties should help in public benefit. Opposition of the party in this regard is not good.
CA R P Vijay on 04 Jan, 2016 wrote:

Thanks and we also wish you and your family a very happy and prosperous new year.
Rahul Singhvi on 04 Jan, 2016 wrote:

Thank you for your lovely greetings ! Wishing you & your family a very happy & fun filled New Year
O V Srinivasan on 04 Jan, 2016 wrote:

We from Gokak Textiles limited wish you and your team a very happy and prosperous New Year 2016.

Case Laws

PJ/Case Laws/2011-12/1120

Whether clandestine removal can be said to be proved on mere admission of Manager that there is shortage?

Prepared By:
CA. Rajani Thanvi &
Bharat Rathore

Case: Commissioner of C. Ex., Lucknow v/s Roll Tubes Ltd

Citation: 2011 (265) ELT 414 (Tri-Del)

Issue:- Whether clandestine removal can be said to be proved on mere admission of Manager that there is shortage?

Brief Facts:- Respondent-assessee is engaged in the manufacture of Black Steel Pipes and Tubes. During the visit by Central Excise officers, shortage of 51.08 MT of finished goods was noticed. Such shortage was admitted by the Factory manager. And the respondent deposited the duty involved within next 2 days.

Revenue issued show cause notice with proposal to confirm the demand and impose penalty. The Adjudicating Authority dropped the proceedings on the ground that the shortage was on eye-estimation basis and not on verification of stock on actual weighment basis. Also there was no corroborative evidence on record.

Against this decision, Revenue is in appeal before the Tribunal.

Appellant’s Contentions:- Revenue contended that the statement of the manager supports their case.

Reasoning of Judgment:- The Tribunal is of the view that there is no reference to any evidence corroborating the statement of clandestine removal. The statement of the Manager only admits shortages but there is no admission on his part that the shortage was due to clandestine removal. Thus, the Lower Authorities have rightly held that such shortage may lead to suspicion but in the absence of any positive and tangible evidence with regard to clandestine removal, the allegations cannot be upheld. It was also seen that no mode of Weighment was indicated in the panchnama. There was no inventory on record and no details as to how such a huge quantum was verified by the officers. Impugned orders of the Lower Authorities upheld.

Decision: - Appeal rejected.

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