ORDER
Archana Wadhwa, Member (J)
1. Being aggrieved by the order passed by the Commissioner (Appeals) the Revenue has filed the present appeal. I have heard Shri K.J. Sanchej, learned D.R. appearing for the Revenue and Ms. Shilpa Dave, learned Advocate for the respondents.
2. The respondents are engaged in the manufacture of paper based decorative laminated sheet and industrial laminated sheet. Their factory was visited by the Central Excise officers on 13-1-2005, who conducted various checks and verifications. During the course of search, rough private register and note pad were recovered. Scrutiny of the same revealed that the appellants had produced decorative laminated sheets during the period 7-1-2005 to 12-1-2005, which were not accounted in Central Excise statutory records. The statement of Shri Hansmukh Bhai Patel, production supervisor was recorded wherein he deposed that he maintains the said record for his personal note and after completion of production of laminated sheet, he enters the particulars in the register. Statement of Shri Raj Kumar Agarwal, Director of the assessee was also recorded wherein he stated that he was aware of maintenance of register and note book pad recovered from the production area and maintained by the staff. As regards the difference between the entries in the said register and RG-1, he deposed that the same might have been cleared from the unit without accounting in RG-1 and without preparing Central Excise invoices.
3. On the above basis, proceedings were initiated against the respondents for recovery of duty of Rs. 1,23,321/- B.E.D. and Rs. 2,466/- Education CESS. The said proceedings initiated by show cause notice dated 13-6-2005 resulted in passing of Order-in-Original by the Asst. Commissioner confirming demand of duty, as proposed and imposing personal penalty of Rs. 50,000/- on the respondents. In addition personal penalty of Rs. 5,000/- was also imposed on Shri Raj Kumar Agarwal, Director. On appeal against the above order the Commissioner (Appeals) set aside the same by observing that a case of clandestine removal cannot be established on the basis of entries made in rough register and the statements. The same is required to be established by positive evidence such as excess procurement of raw materials and their use in the manufacture of illicitly removed goods, clearance documents like delivery challans, lorry receipt, flow back of money, etc. As such he held that mere diary and note book and the statement on the day of seizure is not sufficient to prove the clandestine removal in absence of any other material/tangible evidence as the Tribunal repeatedly held that clandestine clearance require absolute and beyond doubt evidence.
4. After considering the submissions made by both sides and after going through the submissions made by both sides and after going through the impugned order I find that the entire case of the Revenue is based upon the entries made in private register and note book recovered during the course of search of the factory. The statement of production supervisor and the Director of the company do not inspire confidence in the Revenue’s case inasmuch as Shri Patel, Production Supervisor had clearly deposed that the said register was being maintained for his personal knowledge. He has nowhere admitted the difference in figures on account of clandestine removal of the goods. Similarly, Shri Raj Kumar Agarwal’s statement nowhere admits in clear terms that the goods have been cleared clandestinely. He has only deposed that the same might have been cleared from the unit without accounting in RG-1. He has, further, statement that he was not able to explain reasons for the same as his daughter is seriously ill and bed ridden and he was not attending factory regularly. As such it is clear from the above statement that there was no admission on the part of the Director and he only expressed possibility of clearance of goods without payment of duty, as he was not attending factory regularly on account of his daughter’s illness. For the similar reason he agreed to deposit the differential duty amount and as such nothing turns in favour of the Revenue on the said point.
5. As rightly observed by the Commissioner (Appeals), Revenue is required to establish its allegation of clandestine removal by production of sufficient and tangible evidence. Such allegation cannot be upheld on the basis of doubts and assumptions and presumptions. There being, admittedly no evidence to support the allegation, I find that the Commissioner (Appeals) has rightly set aside the order of the lower authority. As such appeal filed by the Revenue is rejected.
(Pronounced in the Open Court.)