TaxTMI 
TaxTMI 
2012 (2) TMI 473
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.... private challans and without issuing proper invoices, the documents were taken over under a panchnama. Statements of various persons including the Director and the Managing Director were recorded during the investigation. The authorities also recorded the statements of suppliers of raw materials, buyers of paper from M/s. FPML and statements of transporters. On investigation and scrutiny of all the documents and statements, a show cause notice dated 8-11-2006 was issued to the main appellant and other appellants directing them to show cause as to why demand of the duty foregone in the clandestine removal be raised and penalties imposed on all the appellants contested the show cause notice on merits before the Adjudicating Authority. The Adjudicating Authority did not accept the contentions raised by the appellants and confirmed the demands and also imposed penalties on the main appellant and also imposed penalties on other appellants who are before us. 3. Learned counsel appearing on behalf of all the appellants would submit as under : 3.1 It is his submission that on the day of search, the officers did not find any shortage of raw materials when compared to the statut....
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....venue in the show cause notice inasmuch as show cause notice alleges that the details in pen drive recovered from the factory premises has clearances which were made and reflected in statutory records, while the statement of the Managing Director was recorded indicating that the pen drive had the details of clearances which were done without recording them in statutory records. It is his submission that there is clearly omission and commission in the statements, which were retracted by the Directors. It is his submission that inferences of clandestine removal sought to be drawn from the statement of six buyers of the paper and some of the suppliers of raw materials are not reliable, for the reason that all the said statements have been retracted and such retractions have been filed before the Adjudicating Authority, no challans were recovered from or found at the buyers' premises as has been claimed by the Department, for clandestine removal of the goods, none of the buyers or suppliers have been made a party to the notice, as, if the buyers had been receiving unaccounted paper from the appellant without duty paying document, clearly they have dealt with the goods which are liable ....
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....ay Cosmetics Pvt. Ltd. - 2005 (192) E.L.T. 708 (Tri.-Bang.), Arch Pharmalabs Ltd. - 2005 (182) E.L.T. 413 (Tri.-Bang.) in the proposition that the charge of clandestine removal cannot be established on the basis of challans which were prepared to show higher turnover for taking loan from bank. It is his submission that there is a mismatch of figures between challans and party-wise statements sought to be relied upon for the purpose of working out alleged clandestine clearances which itself would show that no reliance can be placed on either of them. It is his submission that the production capacity of the machines which has been installed in the main appellant's factory clearly indicate that they cannot manufacture more than 20 MTPD of the paperboard as the certificate issued by the manufacturer and the chartered engineer who had done so after inspecting the said machine. He would submit that when the machinery itself cannot have a production capacity of more than 20 MTPD, the calculations worked out by the authorities would be totally wrong when the total production sought to be as allegedly manufactured by the appellant is more than the production capacity as certified by the man....
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....udgments : 1. Kalvert Foods India Ltd. - 2011-TIOL-76-SC-CX. - 2011 (270) E.L.T. 643 (S.C.). 2. Surjeet Singh Chhabra - 1997 (89) E.L.T. 646 (B.C.). 3. Alladi Drilling Equipment Pvt. Ltd. - 2011 (263) E.L.T. 438 (Tri. - Bang.). 4. Fortune Impex - 2001 (138) E.L.T. 556 (Tri. - Kolkata). 5. Devi Dass Garg - 2010 (257) E.L.T. 289 (Tri. - Del.). 6. Montex Dyg. & Ptg. Works - 2007 (208) E.L.T. 536 (Tri. - Ahmd.). 7. Systems & Components Pvt. Ltd. - 2004 (165) E.L.T. 136 (S.C.). 8. Nipon ZIP Industry Pvt. Ltd. - 2009 (236) E.L.T. 554 (Tri. - Mumbai). 9. Mukhtar Umar Gojaria - 2009 (233) E.L.T. 474 (Tri. - Mumbai). 5. In rejoinder to the submissions made by the SDR, learned counsel would submit that Apex Court in the case of Shalimar Rubber Industries (supra) has clearly laid down the law that oral statement of third party implicating the assessee for clandestine purchase of material, if denied subsequently i....
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.... evidences on record or not. 10. We find that in Volume No. l Page 538, there is a certificate given by one of the chartered engineers which is dated 1-12-2004, which indicates about the production capacity of the machines installed by the main appellant. On perusal of the said certificate, we find that the said chartered engineer has specifically stated that the machine installed in the factory premises of the main appellant even if it is run on three continuous processed plants, the production of finished goods that could be achieved is 20 MTPD of a particular basic weight range of 200 GSM to 600 GSM. On perusal of the records, we find that the quantity of production which is sought to be allegedly manufactured by the appellant and clandestinely removed after detecting the clearances recorded in statutory records, would amount to almost 33 to 35 MTPD of the paper or paper board. It is in our view, seems to be incorrect from the fact that the Chartered Engineer had given a certificate which indicates production capacity of 20 MTPD, the quotation and the invoice of the supplier of the machinery also indicates that the production capacity of the machines is only 20 MTPD as per....