TaxTMI 
TaxTMI 
2018 (2) TMI 394
X X X X Extracts X X X X
X X X X Extracts X X X X
....cts of the case are that the appellant is engaged in the manufacture of sponge iron classifiable under Chapter 72 of Central Excise Tariff Act, 1985. On 21.09.10, the Central Excise officers of Central Preventive Unit, Bhubaneswar II Commissionerate conducted a search operation at the factory premises of the appellant. They recovered one private register bearing document no. 18. A joint physical stock verification was conducted on 21.09.2010 and a shortage of finished goods was found involving Central Excise duty of Rs. 9,312/-. A Show-cause notice dated 03.08.2011 was issued proposing demand of duty of Rs. 20,59,776/- along with interest and penalty. Penalty was imposed on the ground of alleged clandestine removal of goods on the basis of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cause notice stated that the labour register seized records the attendance of the labourers. On the back side of the said labour register, rough entries are available which cannot be treated as correct figures of production and dispatch. It is also stated that the said entries are not collaborative with any evidence. It is contended that Shri Biswal appeared before the Central Excise officers and stated that such figures have been recorded by Shri Dwivedi. Therefore, Shri Biswal is not the author of the said records. Shri Biswal denied knowledge of the facts recorded in the books of accounts in the office and that he had not written the production and sales figures in the Labour Register. 6. On perusal of the statements, I find that it i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t be sustained merely on the basis of labour attendance register, which is uncorroborative in nature. The Tribunal, in the case of Golden Steel Corporation Ltd. v. CCE, Kolkata-II [2017 237 ELT 570 (Tri.-Kol.)], observed that the clandestine removal of goods is a serious charge and cannot be held on the basis of presumption, assumption and surmises. In that case, the demand was raised on daily performance report of HR strips prepared by quality control incharge of the assessee recovered from its factory. The Tribunal set aside the demand. The relevant portion of the said decision is reproduced below: "6.1 So far point at 6(i) above is concerned the case of the Revenue is that the document prepared by Shri Pradip Chatterjee and his ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....can Agro Industries Ltd. (supra) will not be of any help to the department because these relied upon authorities does not say that a statement/document has to be blindly accepted without cross-examination of the concerned witness. It is relevant to note that in the case of AC C. Ex Rajamundry v. Duncan Agro Industries Ltd. (supra) Apex Court was deliberating a situation where a statement under Section 108 of the Customs Act, 1962 was to be used against the accused. In the present case appellants have never confessed to the offence committed. No doubt Shri Rajnish Gambhir, Director of GSCL gave evasive/ambiguous version but never admitted to have indulged in clandestine manufacture and removal of finished goods. In such a factual matrix evid....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... & Cus. (supra) relied upon by the department the case before Gujarat High Court involved a situation where partner of the appellant admitted the clandestine clearances as per Para 3 of this case law. Case law of Somani Iron & Steels Ltd. v. CESTAT (supra) relied upon the Revenue does not convey whether offence was admitted by that party or whether cross-examination was sought. 6.1.1 It is a well accepted legal proposition that clandestine removal is a serious charge and cannot be held on the basis of presumption, assumption and surmises." 8. I find that the appellant placed an affidavit dated 29.12.10 of Shri Biswal, production manager of the appellant retracting his earlier statement dated 23.11.10. The Tribunal consistently v....