TaxTMI 
TaxTMI 
2015 (4) TMI 736
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....igating team asked the Director of the appellant-Company to furnish stock of the finished goods and inputs as on 04.10.2006 as per records. The position of stock so furnished revealed that finished goods of sponge iron 247.080 MT was as per record. But when physical verification of such goods was made and inventorised in panchnma dated 04.10.2006 that resulted with shortage of 2.580 MT of such goods. Therefore, investigation took custody of records and documents as detailed in the Annexure to the panchnama for further scrutiny. (ii) Investigating team recovered certain loose sheets from factory which related to loading advices and gate passes showing removal of excisable goods. Such sheets were maintained by the appellant for the period from 28.09.2006 to 02.10.2006. On comparison of the entries contained therein with the Central Excise invoices, it was revealed that 562.130 MT of Sponge iron and 81.010 MT of Dolochar were removed by the appellant-Company without issue of invoice and without payment of duty. (iii) Records listed at serial nos.3,4,6,7,8,10,11 & 12 of the Annexure-B to panchanama dated 04.10.2006 were examined by the investigating officers. Statement of the shi....
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....red after unloading of the goods at the destination. After perusal of the disputed consignment notes he confirmed that the quantity of the goods mentioned therein have been transported from the consignor to the consignee resulting in removal of 69.180 MT of Sponge iron without issue of Central Excise invoice. 4. The scrutiny of the bilty books recovered from the business premises of M/s. Giriraj Roadlines, Raipur on 20.12.2006 revealed that the appellant-Company had removed substantial quantities of Sponge iron without payment of duty. Statement of Shri Prabhakr Chapale, Proprietor of the transporter company recorded on 22.12.2006 revealed that the particulars appearing in the disputed consignment notes were correct and the goods were transported from consignor to the consignee through the consignment notes resulting in removal of 55.855 MT of Sponge iron without issue of Central Excise invoice. 5. The entries appearing on various private records and documents recovered from the factory premises of M/s. Kailash Traders, Proprietor Shri Kailash Agrawal, a broker/commission agent of iron & steel on 20.12.2006 also confirmed that the appellant-Company had removed a large quantit....
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....cross-examination was not allowed, the statement of persons who gave statement should not have been used by Revenue against the appellant. Private records do not provide any degree of reliance. When there were no positive evidence of clandestine removal, allegations of Revenue became baseless. The ledger recovered by investigation did not prove maintenance of any fake record. 7.3 Learned counsel relied on the following case laws:- (a) T.G.L. Poshak Corporation Vs. CCE, Hyderabad 2002 (140) ELT 187 (Tri. Chennai) (b) CCE, Chandigarh I Vs. Shingar Lamps Pvt. Ltd. 2010 (255) ELT 221 (P&H) (c) CCE, Meerut I Vs. R.A. Castings Pvt. Ltd. 2011 (269) ELT 337 (All.) (d) Padala Veera Reddy Vs. State of Andhra Pradesh & Ors AIR 1990 SC 79 (e) CCE Vs. Vandana Art Prints Pvt. Ltd. 2008 (221) ELT 27 (Guj.) (f) Kumar Trading Company Vs. Commissioner of Trade Tax, Lucknow 2008 (230) ELT 240 (All.) (g) Hilton Tobaccos Ltd. Vs. CCE, Hyderabad 2005 (183) ELT 378 (Tri. Bang.) (h) CCE, Ludhiana Vs. Renny Steel Castings (P) Ltd. 2013 (288) ELT 45 (P&H) (i) Basudev Garg Vs. Commissioner of Customs 2013 (294) ELT 353 (Del.) 8.1 Revenue on the other hand, submitted that on f....
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....ant. Active involvement of appellant in that regard came to record since those materials were in the custody of the appellant. It is common sense that the materials having utility to the possessor thereof are only possessed by him. He proves ownership thereof and is answerable to the contents therein. Entries on such incriminating materials demonstrated clandestine clearance of 562.130 MT of Sponge Iron and 887.560 MT of such goods respectively well explained by appellant. That also proved clandestine removal of 81.010 MT of Dolochar by the appellant. Such removals were further proved from the records seized from the transporters M/s. Purwanchal Road Carriers and M/s. Giriraj Roadlines. The materials recovered from transporters brought out the evidence of clandestine removal of 69.180 MT of Sponge Iron and 55.855 MT of such goods respectively. Those clearances were not substantiated by excise invoices. When certain entries in the pencil handwritten ledger matched with the central excise invoices and other entries did not match, the unmatched entries, became testimony of clandestine removals not supported by invoices. Accordingly, such clearances became subject-matter of allegation ....
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.... High Court has held in the case of Alagappa Cements Pvt. Ltd. Vs. CEGAT, Chennai - 2010 (260) E.L.T. 511 (Mad.) that no existence of the finished goods found during physical inventory proves clandestine removal. Similarly, in the case of CCE Vs. International Cylinders Pvt. Ltd. - 2010 (255) E.L.T. 68 (H.P.), the Hon ble Himachal Pradesh High Court held that no person will maintain authentic record of illegal activities. Burden shifts to manufacturer once Department proves something illegal being undertaken. It is elementary jurisprudence that no law can be interpreted in a manner so as to give premium to illegal and criminal activities. Hon ble High Court of Rajasthan in the case of Rajesh Goyal Vs. Union of India 2012 (284) ELT 164 (Raj.) viewed that tax evasion may be termed as Royal Thievery which is opposed to both democracy and society order. Evading excise duty or tax which is required to be paid by the industrialists or businessmen, if not paid honestly by them is also an indirect form of corruption in this civilized society of democratic State. Such act of evasion of excise duty not only affects the economy of the State but destroy the cultural heritage also. ....