TaxTMI 
TaxTMI 
2018 (8) TMI 791
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....enalty on M/s Maa Banjari Ispat Ltd for clandestine removal of 683.630 MTs of MS ingots. Penalty has also been imposed upon Shri Dilip Agarwal in terms of Rule 26 of erstwhile Central Excise Rules, 2002. 2. Ld. Counsel for the appellants submit that the entire case of the department is based upon the entries in the diary recovered from one Mr. S.K. Pansari (proprietor of M/s Monu Steels) and also on the statement of the said Mr. S.K. Pansari, without their being any corroborative evidence. He also submitted that the said Mr. S.K. Pansari did not appear for cross examination. The Ld. AR appearing for the Department reiterated the findings in the impugned order. He also submitted that the ld. Commissioner in the impugned order has specific....
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....ich established that they had cleared/ removed a total quantity of 1456.015 MT MS Ingots from their factory as detailed in Annexure-A, clandestinely without discharging the central Excise duty due on the same and without issue of Central Excise invoice. In reply Shri Dilip Agarwal, deposed that they never had any transactions with or through the said M/s Monu Steels (Prop. Shri S.K. Pansari), Raipur, and they had never paid any commission to the said trader. To the specific query as to why their units name figure in the list of units recorded in the documents/ records recovered from M/s Monu Steel (Prop. Shri S.K. Pansari), Raipur, Shri Agarwal submitted that he has no idea as to how their name features in the diaries and ....
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....M/s Monu Steels (Prop. Shri S.K. Pansari), Commission Agent, Raipur and after seeing the entries pertaining to my unit and satisfying myself that Annexure-A has been prepared on the basis of such entries I am affixing my signature on it, as a token of having seen and perused the same. " 5. Therefore, apart from the third party statement, no other corroborative evidence has been produced by the Department. 6. The said show cause notice is mainly based upon the entries recorded in the dairy of third party i.e. one Sh. S.K. Pansari proprietor of M/s. Monu Steel. The entire case of the Revenue is based upon the records recovered from the said Sh. S.K. Pansari proprietor of M/s. Monu Steel. 7. The ld. Advocate for the Appellant submitte....
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....ht be sale of clandestine removal of goods through M/s Monu Steel, then the onus is on the department to make an enquiry from at least some of those customers who might have purchased such goods. However, no such enquiry has been made from any of those persons. 9. In the impugned order nowhere it has been discussed as to how the demand of duty is sustainable in the absence of any clinching evidence of clandestine manufacture and removal of the goods. The entire demand is based upon the records recovered from Sh. S.K. Pansari proprietor of M/s Monu Steel. There is no evidence expect the said statement and private diary entry of 3rd party i.e. of Sh. S.K. Pansari which contains the name of the appellant. 10. The law as to whether the th....
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....s to the appellant's clearances. When the Director of the appellant contacted by Revenue, he very clearly, in his statement recorded by the officers, deposed that he does not even know M/s Monu Steels. Further, the Revenue has not made any enquiries from the buyer M/s Sapna Steels and has solely relied upon the entries made in the record of M/s Monu Steels. 5. The law i.e. as to whether the third party records can be adopted as an evidence for arriving at the findings of clandestine removal, in the absence of any corroborative evidence, is well established. Reference can be made to Hon'ble Allahabad High Court decision in the case of Continental Cement Company Vs. Union of India - 2014 (309) ELT 411 (All.) as also Tribunal's decisi....