TaxTMI 
TaxTMI 
2018 (7) TMI 1189
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....rial is melting scrap, sponge iron, ferro alloys, etc., by using electromagnetic induction furnace. A search operation was conducted at the factory premises of one M/s Sarada Steel Industries Ltd., Malwan, Fatehpur (SSIL for short) and M/s Shubh Metals, Malwan, Fatehpur and their various related premises, wherein certain documents etc. were resumed evidencing unaccounted receipt of raw material and unaccounted clearance of final products as well as under valuation by the said SSIL and Shubh Metals. Separate show cause notices were issued to the said SSIL and Shubh Metals. From the premises of SSIL some private document, namely daily incoming material report and consolidated monthly report were resumed as per SI. No. 2(i) of Annexure to the ....
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....d consolidated monthly report against the name of SFL were segregated and accordingly it appeared that SSIL have received 1079.465 MT of ingots. It appeared that in the official books of accounts of SSIL, a suppressed quantity of ingots actually received from SFL - appellant had been shown. Further SFL had also not accounted for all the supplies of ingots made to SSIL in their books of account for the corresponding period. Further on scrutiny of daily incoming material report and consolidated monthly report of SSIL for the month of July, September and October, 2004 it was revealed that the details of the receipts of ingots by SSIL from appellant - SFL differed widely with the corresponding figures of accounted for clearance/receipts as main....
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....pplied MS ingots in such magnitude to SSIL and Shyam Ferrous Ltd. On these facts, it appeared to Revenue that the appellant SFL is responsible for the clearance of unaccounted ingots to SSIL without their accounting in their books of accounts and without payment of duty and thus, the appellant company and its Director G.K. Gupta, were involved in suppression of production and clearance of the final products, namely MS ingots which appear to be liable to confiscation. Accordingly show cause notice was issued dated 03/08/2009, followed by corrigendum dated 04/08/2009, demanding duty of Rs. 28,60,826.52 plus Rs. 57,216.53, totaling Rs. 29,18,043.05 on the apparent differential quantity of ingots being 940.270 MT, alongwith interest and further....
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....e allowed with consequential benefits. 8. The Learned A.R. for Revenue have relied on the findings in the impugned order. 9. Having considered the rival contentions, I find that the whole case of Revenue is based on third-party records (private records) and the statement of the third-party. I further find that in spite of interrogation of the responsible persons of the appellant company, there is neither any admission on their part nor Revenue have brought any corroborative evidence in support of this allegation. It is established principle that suspicion howsoever strong cannot take place of evidence, particularly in the case of clandestine removal. 10. I further find that Hon'ble Allahabad High Court in the case of Continental Ceme....