2025-VIL-1500-CESTAT-KOL-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Clandestine Manufacture and Removal, unverified Input-Output Ratio, Corroborative Evidence - Revenue alleged that the appellant had suppressed the actual quantum of production and did not record the production of finished goods actually manufactured, with the intent to evade payment of central excise duty - Whether the reconciliation of the seized challan books carried out by the Range Officer, without providing the same to the appellant, can be relied upon to confirm the demand - HELD - The appellant was not provided the purported reconciliation report submitted by the Range Officer to the Commissioner, violating principles of natural justice. The Commissioner cannot rely on such an unshared reconciliation report to confirm the demand – Further, the Revenue's allegations are based on mere assumptions and presumptions, without any positive and tangible legal evidence. The Revenue failed to provide details of excess raw material procurement, increased electricity consumption, statements of purported buyers, etc. to corroborate the clandestine removal. Mere confessional statements without corroboration cannot sustain the demand - the Revenue has not conducted any independent verification of the input-output ratio and has relied solely on theoretical calculations. The appellant has provided documentary evidence, including a Chartered Engineer's certificate, supporting its claimed input-output ratio. In the absence of any independent verification by the Revenue, the appellant's claim on the input-output ratio has to be accepted - the demand for the extended period is not sustainable due to time-bar, as the Revenue failed to effectively bring any evidence of suppression by the appellant – The impugned order is set aside and the appeal is allowed
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