TaxTMI 
TaxTMI 
2018 (3) TMI 260
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....oth of ASC) and Amman Lodge. SASAI manufacturers iron rods and bars. SUAS manufactures ingots and billets. AE deals in iron rods and bars. ASC & RSA deal in scrap. At SASAI the officers conducted stock taking and found excess stock of finished goods of 89 MTs (approx.) of bars/rods and shortage of 70.5 MTs of raw materials, namely, ingots/billets. Searches were followed by elaborate investigation. The officers also visited dealers premises, lorry transport offices, weigh-bridges and certain other premises. Several records/documents were recovered. SASAI maintained computerized accounts somsacc of production and raw materials. The same was integrated with a program to generate invoices. A CPU and a few floppy discs were seized from SASAI. Floppy disc were seized also from the residence of Ms. Ponnalagu. Floppies were found to contain detailed accounts of transactions, both recorded in the statutory records and a major portion, only in private records. The floppy discs were found to contain comprehensive details of several transactions of SASAI and SUAS in iron bars/rods/ ingots/ billets/ scrap/fuel not reflected in statutory records as well as payments to transporters etc. found in ....
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....e clearance by SASAI for the year 2001 02. The Tribunal vide common Final Order No. 529 to 535/2008 dated 30.4.2008 remanded the matter. The department s appeal was also remanded vide Final Order dated 28.10.2008. The assessee as well as department filed miscellaneous application for rectification of mistake in the Final Orders cited supra. The Tribunal passed Misc. Order dated 10.10.2008 on the ROM applications. Pursuant to such Final Orders remanding the matter as well as the miscellaneous orders passed on the applications for ROM, the matter was taken up for denovo adjudication by the Commissioner. 5. In such denovo proceedings the Commissioner passed the impugned order herein No. 3/2009 dated 20.3.2009 against SASAI. The operative portion of such order is reproduced as under:- i. I confiscate the excess stock of 89.025 MT of bars and rods valued at Rs. 24,93,000/- (approx.) seized at the premises of SASAI on 24.06.2004, under Rule 25 of Central Excise Rules,2002; ii. I give an option to Shri Amman Steel and Allied Industries, Nagamangalam, Trichy to redeem the above goods on payment of appropriate duty and on payment of redemption fine of Rs. 1,40,000....
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....penalties on the co-noticees. 7. On 26.2.2018, at the time of hearing, the ld. counsel Shri S.Jaikumar submitted that the appellant in Appeal No. E/357/2009 is withdrawing the appeal and is not contesting the submissions made in the appeal. He submitted that the Commissioner has rightly followed the clarification given in the Miscellaneous Order on ROM applications, wherein the evidence obtained from the computer floppy opened using unauthenticated software has to be excluded. The department has not filed any appeal against the said Miscellaneous Order on the ROM applications or the Final Orders passed by the Tribunal and the said orders have attained finality. Thus, the Commissioner has rightly excluded the evidence obtained from computer floppies opened using unauthenticated software while denovo adjudication in remand proceedings. It is also submitted by him that in para 26 to 28, the Commissioner has discussed the reason for not imposing penalty on the co-noticees. He therefore prayed for orders accordingly. 8. The ld. AR Shri S. Govindarajan reiterated the findings in the impugned order. 9. Heard both sides. 10. The ld. counsel for appellant has submitted that the ....
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....tially eroded. These lapses pointed out by appellants justify their claim that the floppies could have been manipulated. The infirmities as pointed out by Tribunal in Para- 14 of its order dated 30.04.08; cannot be cured at de-novo adjudication stage. The list of inventories prepared at the time of seizure does not mention the CPU and floppy. Hence these evidences lost credibility. The credibility is further eroded in view that Mahazer witnesses were not present throughout the seizure and search proceedings. Thus, any data retrieved from above evidences is not beyond suspicion. 12. The Commissioner thus held that the entire electronic data loses its credibility and is not reliable and therefore discarded. For the purpose of adjudication, by confining to the evidence other than that obtained from computer floppies opened using unauthenticated software, the Commissioner has dropped the demand of Rs. 7,60,79,469/-. 13. One of the points agitated before the Tribunal by the appellants was that the evidence recovered from the computer floppies cannot be relied upon for the reason that the department had used unauthenticated software for opening the files. In the ROM filed by the as....