TaxTMI 
TaxTMI 
2019 (5) TMI 713
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....o their customers. M/s VH is one of their customers who receives this jumbo rolls and cuts them into smaller BOPP adhesive films and clears them. Directorate General of Anti Evasion received intelligence and searched premises of M/s VH, Madurai and issued a show cause notice to them. The present show cause notice is result of follow up enquiries by DGCEI, Hyderabad. The allegation in this show cause notice is that M/s SPPL cleared jumbo rolls of 3000m length and misdeclared them as of 1000m length and thereby under paid Central Excise duty. The details of the disputed invoices are in annexure E to the show cause notice. During investigation, officers recorded statement of Shri V. Raja Gopal, Vice President of SPPL who, inter alia, indicated that the weight of 1000m jumbo roll will be between 45-50 kg and the weight of 3000m jumbo roll will be between 1035 and 1050 kg. In all the disputed invoices the quantity mentioned in invoices is as per the quantity declared by them and the duty has been paid accordingly. Since, the goods have to be carried from M/s SPPL in Hyderabad to M/s VH in Madurai, a transporter was engaged and the transporter issued the Goods Consignment Notes (GCNs) in....
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....show cause notice, there is no evidence to the clearance of 3000m length rolls by SPPL through excise invoices which were issued. He would draw the attention of the bench to Sl.No.2 of annexure to show that 3000m consignments were also cleared and invoiced by the appellant. He further, submits that there were also 1500m length rolls which they had cleared, as can be seen from the worksheets. He further, submits that the two test reports of one invoice recovered at M/s VH in the earlier proceedings are being relied upon by the department which is not correct because the present proceedings are independent of the earlier proceedings. Further, he argued that based on quality control report of one invoice duty cannot be demanded on 19 invoices presuming that all invoices were correspondingly related to clandestine clearances of the goods. 5. His other line of argument was that the department failed to produce evidence of purchase of raw materials and clearance of such huge quantity of finished products and no documents, whatsoever, were recovered during the search proceedings and therefore, the demand cannot be confirmed on this ground. He further argued that the GCNs are raised by ....
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....rified that each roll of 1000m weighs between 45-50 kg and each roll of 3000m weighs between 1035-1050kg. Therefore, if the total weight of the consignment is divided by the weight per unit, we know the quantity of goods cleared. These individual GCNs were further compared with the statement in the form of a computer printout generated by the transporter because he has to maintain an account of what quantity of goods have been cleared and how much he needs to be paid to him for the transport. Both these were tallied before arriving at the quantity of alleged clandestine removal of the goods. These calculations were further strengthened by the test reports recovered from the premises of the buyer. It is true that the individual test report is available only in a few cases but the test reports which were relied upon are sufficient to buttress the case of the revenue which is primarily based on the transport documents which show the quantity of goods which were taken out of SPPL and sent to M/s VH. The test reports are not of any outside agency but were prepared by the lab of the appellant themselves. He would argue that the learned counsel is not correct in stating that since their t....
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.... proceedings and nobody knows it better than the Vice President of the appellant. It is true that the department searched the premises of SPPL almost one year after the initial search and has not found any incriminating documents. The second point of argument of the appellant is that there is no evidence of procurement of raw material or evidence of manufacture of illicitly removed goods and it is only based on transport documents. Therefore, the same does not sustain. Learned counsel relied on the case laws which are as follows: (i) Continental Cement Company Vs Union of India - 2014 (309) ELT 411 (All.) (ii) CCE, Raipur Vs Anil Agrawal - 2013 (287) ELT 489 (Tri-Del) (iii) Dalmia Vinyls (P) Ltd Vs. CCE, Hyd - 2005 (192) ELT 606 (Tri- Bang.) (iv) CCCE & ST, Bharuch Vs Shree Krishna Industries - 2017 (345) ELT 629 (Guj.) (v) Vigirom Chem Pvt Ltd Vs CCE, Bangalore - 2010 (251) ELT 544 (Tri-Bang.) (vi) Commissioner Vs Motabhai Iron and Steel Industries - 2015 (316) ELT 374 (Guj.) (vii) Kothari Pouches Ltd Vs CCE, New Delhi - 2001 (135) ELT 531 (Tri-Del.) (viii) A. Tajudeen Vs UOI - 2015 (317) ELT 177 (SC) ....
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....ce and the quantity arrived at by the weight, no demand was made and such transactions were faithfully recorded in annexure E to the show cause notice. The test reports in question pertain to only few consignments and not to each consignment because only few test reports could be recovered from the buyer's premises. Thus, quality control test reports were made by the supplier's own quality control lab which also corroborate with the calculations made based on the GCN and statements by the transporter. Therefore, to that extent these test reports serve as additional corroborative evidence. In the factual matrix of this case, I find that there is sufficient evidence of clandestine removal by SPPL. It is impossible to have every single document to show with mathematical precision the clandestine removal starting from raw material to their production and clearance because by its very nature, clandestine removal is done without recording the figures. If all figures were recorded faithfully in the documents there will not be any clandestine removal. Therefore, in each and every case of alleged clandestine removal the facts and circumstances must be evaluated to come to a conclusion if th....