2026-VIL-669-CESTAT-KOL-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Clandestine Removal of excisable goods - Appellants were charged with clandestine manufacture and clearance of excisable goods without payment of duty - Whether the allegation can be established on the basis of private records in the absence of any corroborative evidence – HELD - The allegation of clandestine removal cannot be based on assumptions and presumptions without providing any corroborative evidence. For establishing clandestine removal, there should be tangible evidence such as excess procurement of raw materials, actual removal of unaccounted finished goods, discovery of such goods outside the factory, sale of such goods to identified parties, evidence of receipt of sale proceeds, excess electricity consumption, and statements of buyers - In the present case, the investigating authority failed to bring on record any such corroborative evidence. The allegation of clandestine removal cannot be established solely on the basis of private records in the absence of any other corroborative evidence. The statements recorded during the investigation without complying with the mandatory procedure under Section 9D of the CEA, 1944 also cannot be relied upon as evidence. Similarly, the printouts generated from the pen drives and hard disks seized during the investigation cannot be treated as admissible evidence without fulfilling the conditions prescribed under Section 36B of the CEA, 1944 – Further, the allegation of shortage of stock during the course of investigation, determined solely on the basis of eye estimation and without any documentary evidence or weighment slips, cannot be a ground to allege clandestine removal of excisable goods - The impugned order demanding central excise duty along with interest and penalties is set aside and the appeal is allowed
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