2026-VIL-823-CESTAT-AHM-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Clandestine clearance of goods without payment of duty – Appellant was found to have suppressed taxable turnover based on lorry receipts (LRs) recovered from their premises. Some of the LRs matched with duty-paying invoices, but others did not have any corresponding invoices, indicating clandestine clearance of goods without payment of duty - Whether the charges of clandestine clearance and consequent demand of differential central excise duty along with interest and penalty are sustainable – HELD - The partner of the appellant firm in his statement admitted to the recovery of LRs and that some of the sales invoices issued during 2010-11 and 2011-12 completely tallied with the description shown in the LRs, but majority of the LRs did not have any corresponding central excise invoices. He further admitted to clearing goods shown in the LRs in a clandestine manner without preparing any invoice and without payment of central excise duty, with the intent to evade duty. The confessional statement of the partner, which remained un-retracted, is admissible evidence to support the charges of clandestine clearance – The confession statement made before the Customs/Excise authorities, even if retracted later, can form the sole basis for conviction if found to be voluntary. The recovery of LRs for which there were no corresponding duty-paying invoices, coupled with the partner's confessional statement, is sufficient evidence to establish the charges of clandestine clearance - The demand of differential central excise duty along with interest and equal penalty on the appellant firm is upheld. However, the separate penalty imposed on the partner is set aside as the penalty had already been imposed on the partnership firm – The appeal is partly allowed
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GSTAT Appeal filed wrongly...
By CA Vivek Jalan

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