Law: Central Excise Act, (I of 1944)

Section: 3

(Central Excise Act (I of 1944)]...........3........Central Excise Rules, 1944, Rr. 9, 52-A, 53, 53-B, 226, 241 & 246---Central Excise duty, recovery of---Show-cause notice was issued to appellants on the ground that certain quantity of raw material was removed from Customs Bonded Warehouse without payment of Central Excise duty---Collector of Customs, Central Excise and Sales Tax being dissatisfied with the reply filed by appellant imposed penalty along with duty---Validity---Appellants had accounted for the raw material which was illegally removed from Customs Bonded Warehouse as having been consumed in appellants' declared production---Authorities failed to show any other source of goods in question without which appellants' declared production would not have been possible at all---Such situation ruled out the possibility of any additional production, which was the main cause of proceedings against appellants-Authorities had built the case on the presumption that as the appellants had removed raw material from Customs Bonded Warehouse clandestinely, so the goods produced out of the same must also have been removed without payment of Central Excise Duty and Sales Tax---Such presumption was not substantiated by the authorities---Appellant's act of illegal removal of goods from Customs Bonded Warehouse was cognizable under Customs Act, 1969, and the concerned authorities not only took due notice of the offence but had also punished the appellant in accordance with law---Case which had been made under Central Excise Act, 1944, ought to have been proved independently, which the authorities had failed to do in convincing manner-Order-in-Original passed by Collector of Customs, Central Excise and Sales Tax was set aside---Appeal was allowed in circumstances. ORDER MUMTAZ HAIDER RIZVI, MEMBER (TECHNICAL).---This appeal has been filed by Messrs Paper International (Pvt.) Ltd., Amangarh, Nowshera (hereinafter called as the appellants) against Order-in-Original 61 of 2001, dated 11-5-2001 passed by the Collector of Customs, Central Excise and Sales Tax (Adjudication), Rawalpindi. 2. Brief facts of the case are that the staff of the Collectorate of Customs, Central…

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