AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (12) TMI 1224
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....rtain documents relating to manufacture of Sponge Iron, called "production log registers", in which the details of feeding of raw materials - Iron Ore, coal etc. had been recorded, in addition to other operating parameters like temperature and pressure inside the kiln. Inquiry was made with Sh. Girish Chandra Giri, Production Manager, present at that time and his statement was recorded wherein he stated that production log registers contain the details of the quantities of raw materials fed into the kiln for manufacture of Sponge Iron and also other parameters like temperature and pressure of air inside the kiln and that in their factory, the productivity of Sponge Iron of the coal based kiln is within the range of 57% to 61% of the Sponge Ore fed into the kiln. From the scrutiny of the log registers, the officers determined the total quantity of the Iron Ore fed into the kiln during the period from 21.4.2008 to 27.08.2008 and on the basis that the productivity of the kiln is 61% of the Iron Ore fed into the kiln, they worked out the approximate quantity of Sponge Iron manufactured which came to 7829 M.T. against which the production recorded in the RG-I Register and books of accou....
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....along with interest on it at the applicable rate under Section AB ibid in respect of clandestine removal of 998.890 M.T. of Sponge Iron during the period from February, 2008 to August, 2008; and (c) imposition of penalty on the appellant under Section 11AC of the Central Excise Act, 1944 and also under Rule 25(1) of the Central Excise Rules, 2002 for contravention of the provisions of Rule 4, 6, 8, 10, 11 of the Central Excise Rules. 2.3 The above show cause notice was adjudicated by the Commissioner of Central Excise, Raipur vide order-in-original No COMMR/RPR/5/2001 dated 28.01.2010 by which- (a) duty demand of Rs. 62,80,176/- was confirmed alongwith interest on this duty under proviso to section 11A(1) of the Central Excise Act, 1944 read with Section 11AB ibid on 1866.933 M.T.s of Sponge Iron held to have been cleared clandestinely without payment of duty during April, 2008 - August, 2008 period and 77 MTs of Sponge Iron cleared during Feb. 2008 to 15.3.2008 period and (b) penalty of equal amount was imposed on the appellant under Section 11AC of the Central Excise Act, 1944. (c) The Commissioner dropped the demand on the remaining quantity of Sponge Iron alleged to ....
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....ustomers themselves, the same had been returned; that though the appellant have pleaded before the Commissioner that estimation regarding the quantity of Iron Ore fed into the kiln on the basis of periodical readings regarding feeding rate recorded in the production log register is not correct, but the Commissioner did not give any finding on this plea. Hence, the Commissioner"s order is not sustainable. 4. Cross examination of Sh. Sunil Aggarwal, Proprietor of M/s Sunil Roadlines, Sh. G.C. Giri, Production Manager and Sh. Arindam Dutta, GM M/s Shree Consultants Pvt. Ltd. whose testimony had been relied upon in the show cause notice was denied by the Adjudicating Authority in total defiance of provisions of Section 9D of the Central Excise Act, 1944 and in defiance of now settled position as culled out from the following case law: i. 2016 (337) ELT A204 (SC) Belgium Glass & Ceramics Pvt. Ltd. Vs. Commissioner ii. 2015 (324) ELT 641 (SC) Andaman Timber Industries Vs. Commissioner of Central Excise, Kolkata-II iii 2002 (143) ELT 21 (SC) M/s Laxman Exports Ltd. Vs. CCE iv. 2016 (336) ELT 15 (Del.) HIM Logistics Pvt. Ltd. Vs. Principal Commissioner of Customs v. 2016-TIO....
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....tity of Iron Ore fed and the estimation of Sponge Iron production has been done by the officers by following this method only; that Sh. Sunil Agarwal in his statement dt. 04.09.2008 has also confirmed that the production log registers are maintained for estimating the quantity of Iron Ore and raw materials fed into the kiln and determining the quantity of Sponge Iron produced; that on scrutiny of transporter"s bills, consignment receipt notes issued regarding the receipts of consignment of Sponge Iron despatched by the appellant, weighment slips issued by the consignees showing the receipt of the Sponge Iron and the records maintained in loose sheets, it is seen that, in respect a number of despatches of Sponge Iron to various customers, there were no central excise invoices issued by the appellant and those despatches were not recorded in the RG-I register; that the despatches of the consignments of Sponge Iron without the issue of invoice has been confirmed by the various customers - Sh. Ajay Kumar Gupta, Director of M/s Sairam Steels (Pvt.) Ltd. and Sh. Arindam Dutta, General Manager, M/s Shri Consultants, Raigarh; that though they, while confirming the receipt of consignments o....
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....lips etc. showing receipt of sponge iron despatched from the appellant"s factory as well as records in loose sheets showing the despatch of the finished product to various customers. In some of these cases Central Excise invoices were found to have been issued but in many other cases no Central Excise invoices have been issued indicating, that a large number of consignments have been cleared without payment of duty. On the basis of these incriminating documents recovered by the Department, it is evident that large scale evasion of duty has been done by the appellant. 10. We find that the principal ground on which the appellant has challenged the impugned order is that the adjudicating authority has relied on the statements of several persons without extending an opportunity to the appellant of cross-examining them. They have relied on several case laws and argued that in terms of the provisions of Section 9D of the Central Excise Act, 1944, before the statements of any persons are used by Revenue to establish a case, these witnesses will have to be examined during the course of the quasi-judicial proceedings and an opportunity for cross-examination is required to be extended to th....
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....89 (Del.) = 2011 (22) S.T.R. 225 (Del.). Para 12 of the said decision clearly holds that by virtue of sub-section (2) of Section 9D, the provisions of sub-section (1) thereof would extend to adjudication proceedings as well. 7. There can, therefore, be no doubt about the legal position that the procedure prescribed in sub-section (1) of Section 9D is required to be scrupulously followed, as much in adjudication proceedings as in criminal proceedings relating to prosecution. 8. As already noticed herein above, sub-section (1) of Section 9D sets out the circumstances in which a statement, made and signed before a Gazetted Central Excise Officer, shall be relevant for the purpose of proving the truth of the facts contained therein. If these circumstances are absent, the statement, which has been made during inquiry/investigation, before a Gazetted Central Excise Officer, cannot be treated as relevant for the purpose of proving the facts contained therein. In other words, in the absence of the circumstances specified in Section 9D(1), the truth of the facts contained in any statement, recorded before a Gazetted Central Excise Officer, has to be proved by evidence other than the s....