TaxTMI 
TaxTMI 
2015 (7) TMI 669
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.... by DGCEI on the grounds that no M.S. Scrap was received and that only documents were obtained by the main Appellant. That according to Revenue, even if the entire payments are made through cheques, but an equivalent amount was received by the Appellant in cash transferred through Angadias after deduction of some commission by the Broker. That certain diaries were recovered from Broker Bharat Sheth which indicate that material against the Cenvatable documents were sold to certain re-rolling mills clandestinely against cash payment as per the investigation. That certain statements of the transporters, employees of Shri Bharat Sheth, few ship breaking units and angadias were recorded by the investigation to rely upon and conclude that all purchase of M.S. Scrap was only on paper and no inputs were received by the main Appellant. 2.1 Learned Advocate argued that the inputs received was M.S. Scrap as per the invoices whereas as per the records of Brokers M.S. Plates were supplied to re-rolling mills. That the diary maintained by the Broker also talk of M.S. Plates and not M.S. Scrap. He furnished a copy of one such Cenvatable invoice. It was his case that even invoice numbers under wh....
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....jguru Spinning Mills [2009 (243) ELT 28 (Tri-Che.)] b) Rhino Rubbers Pvt.Ltd. Vs CCE Bangalore [1996 (85) ELT 260 (Tribunal)] c) CBI Vs V.C. Shukla [AIR 1998 SC (1406)] d) TGL Poshak Corporation Vs CCE Hyderabad [2002 (140) ELT 187 (Tri-Che.)] e) Emmtex Synthetics Ltd Vs CCE New Delhi [2002 (147) ELT 649 (Tri-Del)] f) CCE Chandigarh Vs Neepaz Steel Ltd [2008 (230) ELT 218 (P&H)] 3. Shri S. Shukla (AR) appearing on behalf of the Revenue argued that various statements recorded during the investigation are corroborated by the diary maintained by the broker. That Shri Amit R. Bhasin also admitted the correctness of the statement of the broker and his employee by perusing those statements. That all the statements were corroborating each other, therefore, request for cross-examination of the witnesses were correctly denied by the lower authorities. Learned AR made the Bench go through Para 32.1 of the OIO to drive home the point that principles of natural justice were not violated in view of Apex Courts decision in Surjeet Singh Chhabra Vs Govt. of India [1997 (89) ELT 646 (SC)]. Learned AR also made the Bench go through Para 34 of the OIO dt.27.06.2014/01.07.2014 to argue that acc....
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....e consignments received on making payments in cash. There is also no indication as to how Appellants manufactured huge quantities of goods on which duty was paid and how it resourced the inputs. During investigation, no shortage/excess of raw material was noticed. It is difficult to perceive as to how Appellant manufacturers finished goods from air. 4.1 Investigation undertaken by the Revenue no doubt raise a strong presumption on the basis of recorded statements and diary that Appellant may be indulging in some clandestine activity. Manufacturers of M.S. Ingots and rolling products are known to be dealing with commodities prone to evasion but the same notion cannot be the basis to fix all such units on the basis of presumption. In the present case, the entire emphasis is on the statements of third parties to establish the case. Appellant was requesting the Adjudicating authority for cross-examination of all these persons whose statements are relied upon. Three of five ship breaking units denied to have followed the practice suggested by investigation. When statements were the only establishing factors then cross-examination was the only way to assist the Revenue and the arguments....
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....verse party, or whose presence cannot be obtained without an amount of delay and expense which, under the circumstances of the case, the Court considers unreasonable. It is clear that unless such circumstances exist, the Noticee would have a right to cross-examine the persons whose statements are being relied upon even in quasi judicial proceedings....." Hon'ble Delhi High Court while making above observations relied upon Apex Court's decisions in the case of Lakshman Exports Ltd Vs Collector [2002 (143) ELT 21 (SC)] and Swadeshi Polytex Ltd Vs Collector [2002 (122) ELT 641 (SC)]. 4.3 In another case of CBI Vs V.C. Shukla [AIR 1998 SC 1406] Apex Court held that evidentiary value of correct and authentic entries in certain book of accounts, cannot fix the liability of a person in the absence of independent evidence of their trust worthiness. Honble Supreme Court under this case law made following observations in Paras 36 to 39 of the judgment:- "36. The same question came up for consideration before different High Courts on a number of occasions but to eschew prolixity we would confine our attention to some of the judgments on which Mr.Sibal relied. In Yesuvadiyan v. SubbaNaicke....
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....e relevant whenever they refer to a matter in which the Court has to enquire was subject to the salient proviso that such entries shall not alone be sufficient evidence to charge any person with liability. It is not, therefore, enough merely to prove that the books have been regularly kept in the course of business and the entries therein are correct. It is further incumbent upon the person relying upon those entries to prove that they were in accordance with facts. 38. The evidentiary value of entries relevant under Section 34 was also considered in HiralalMahabirPershad, (ILR 1967 1 Punj 435) (supra) I. D. Dua, J. (as he then was) speaking for the Court observed that such entries though relevant were only corroborative evidence and it is to be shown further by some independent evidence that the entries represent honest and real transactions and that monies were paid in accordance with those entries. 39. A conspectus of the above decisions makes it evident that even correct and authentic entries in books of account cannot without independent evidence of their trustworthiness; fix a liability upon a person. Keeping in view the above principles, even if we proceed on the assumptio....