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TaxTMI 
TaxTMI 
TaxTMI 
2016 (10) TMI 567
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.....Chattopadhyay (Consultant) appeared on behalf of the third Appellant. Shri Biswajit Dutta argued that a case of clandestine removal of excisable goods of Chapter 72 of the first schedule to Central Excise Tariff Act, 1985 has been decided against his clients demanding duty of Rs. 21,81,526/- along with interest and equivalent penalty has also been imposed. That the above demand is with respect to the following constituents:- (i) Demand of Rs. 9,86,411/- is calculated on the basis of one Daily Performance Report of HR Strips for the period 18.08.2005 to 31.08.2005 prepared by Shri Pradip Chatterjee who is the quality control in-charge of GSCL. (ii) Demand of Rs. 4,47,064/- pertains to duty on shortages of finished goods and waste and scrap calculated by the officers of Central Excise during joint stock-taking done on 07.09.2005. (iii) Demand of Rs. 7,11,407/- is for clandestine removal of 311.920 MT of HR Strips calculated on the basis of weighment slips recovered from the Headquarters of GSCL. 2.1 Learned Advocate on the issue of above demand of Rs. 9,86,411/- argued that this portion of the demand is based on one Daily Performance Report of HR Strips recovered from the factor....
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....charjee (Office Assistant) of GSCL. That GSCL asked for cross-examination of Shri Pradip Chatterjee and Shri Sahaney as per Para-11 of the Order-in-Original dated 26.09.2006 which has been denied by the Adjudicating authority. 3. It was strongly argued by the learned Advocate of GSCL that demand of clandestine removal cannot be based on presumptions and there should be other supportive/positive evidences in the form of procurement of extra raw materials, excess power consumption, shortages/excesses in the raw material stock. That in the absence of any such positive evidences and due to denial of cross-examination of witnesses no case of clandestine removal is established against the Appellants. In addition to above case laws learned Advocate relied upon the case law of Durga Trading Company v. Commissioner of C.Ex., Lucknow [2002 (148) ELT 967 (Tri.-Del.)] which has been dismissed by Apex Court in an Appeal filed by Revenue. 4. Shri B.N.Chattopadhyay (Consultant) appearing on behalf of M/s.Hariana Iron Works (P) Ltd. argued that his client can not be held responsible for his name appearing in a third party weighment slips and penalized for abetment. That there is no statutory obl....
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....n admissible evidence unless Appellant proves to the contrary. He relied upon the following case laws in support of his arguments:- (i) AC CEx, Rajamundry v. Duncan Agro Industries Ltd. [2000 (120) ELT 280 (SC)] (ii) Commr. of Central Excise v. International Cyilnders Pvt.Ltd. [2010 (255) ELT 68 (HP)] (iii) RHL Profiles Ltd. v. Commissioner of C.Ex., Kanpur [2016 (334) ELT 110(Tri.-Del.)] (iv) Umiya Chem Intermediate v. Commissioner of C.Ex. & Cus. [2009 (239) ELT 429(Guj.)] (v) Somani Iron & Steels Ltd. v. CESTAT [2011 (270) ELT 189(All.)] 6. Heard both sides and perused the case records. The issue involved in these appeals revolves around the activities of appellant GSCL whether they have indulged in clandestine manufacture and clearance of Iron and Steel finished goods falling under Chapter-75 of the Central Excise Tariff Act, 1985. The case against GSCL is based on the following three elements: i) A daily performance report of H R Strips prepared by the Quality Control in charge of GSCL. ii) Alleged shortage of finished goods as per a joint stock taking held on 07.09.2005. iii) Weighment slips of the Golden Weighbridge under the control of appellant GSCL. Above e....
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.... manufacture and removal of finished goods. In such a factual matrix evidences like procurement of extra raw-materials, power consumption, any transit seizure of clandestine clearances etc. become relevant for corroboration. Alternately third party s statement, being used against the appellants was required to pass the test of cross-examination. The case of CCE vs. International Cylinders Pvt. Ltd. [2010(255) E.L.T. 68(H.P.)] relied upon by the department involved a seizure of 822 cylinders from the godown of International Cylinder Pvt. Ltd. and the concerned persons confessed to the clandestine activity. There were host of other statements indicating clandestine activity. There is no indication in this order of Himachal High Court that cross-examination was denied to the party. In the present proceedings investigation has only suggested to some clandestine activity but there is no positive evidence that any goods were clandestinely cleared. There is no statement to this aspect or a transit seizure of alleged clandestinely cleared goods. The case of RHL Profiles Ltd. vs.-CCE Kanpur (supra) relied upon by the department was a situation where a cash of Rs. 8,30,000/- was seized from ....
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.... removal and demand on this ground is not sustainable and is required to be rejected. 6.3. Demand of duty of Rs. 7,11,407/- is based on quantities of clandestine removal calculated on the basis of certain weighment slips recovered from the Golden Weighbridge under the control of GSCL and the statements recorded during the investigation. It was strongly argued by the Learned AR appearing for the Revenue that certain details in the relied upon weighment slips were filled in by the employees of GSCL in the name of one Shri Kedhar Babu indicated one such weighment slips. That the payments received from Shri Kedhar Babu were admitted by Shri Debadas Bhattacharjee of GSCL. Learned Adjudicating Authority vide para-16(V) of Order-in-Original dated 26.09.2006 gave a finding that cross-examination is denied as the voluntary statements relied upon in the show cause notice were not the sole evidence in respect of framing the charges against the appellants in the show cause notice and that there could be browbeating the paid employees to retract them from their earlier admission. We are afraid that reasons given by learned Adjudicating authority are not correct as per the legal propositions on....