TaxTMI 
TaxTMI 
2019 (7) TMI 952
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....their clearances, the officers of Central Excise searched the premises and took stock and found that there was shortage of 5.060 MTs of Sodium Bichromate Mother Liquor (SBML) in the factory on which the duty liability comes to Rs. 28,567/-. Further, they conducted detailed investigation and recorded statements of various persons and seized private records which showed removal of goods without showing them in the Central Excise records and paying Central Excise duty. After analysing all these records, they issued a Show Cause Notice OR No. 54/99-Adjn. dated 10.04.2000 demanding the following duty from VCL. Annexure Product Quantity (MT) Period Duty A SBML 33.555 4/1997 to 6/1998 2,16,007 B SB as YSS 59.5 7/1997 to 6/1998 3,87,351 C SB as BCS 12.95 SB & 12.5 of BCS 3, 9 & 10/1997 1,36,750 D SB, SBML & BCS 11.595 SB, 8.598 of SBML & 1 of BCS June 1998 1,52,624 E SB 172.064 8/1997, Jan to May 1998 12,69,832 - Shortage SBML 5.060 Panchanama 28,567 21,91,131 It was also proposed to impose penalties on the ot....
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....g the stock taking as recorded in the panchanama. He submits that the remaining amount of the demand is based on the analysis of various documents which have been summarized in Annexures A to E attached to the SCN. These are as follows. 1) Annexure-A - the details of SBML cleared in excess over the invoice quantities during the years 1997-98 and 1998-99. The total amount of differential duty demanded on this differential quantity was Rs. 2,16,007/-. 2) Annexure-B - the details of clearances of SB made in the guise of YSS during 1997-98 and 1998-99. The differential duty demanded on this count is Rs. 3,87,351/-. 3) Annexure-C - the details of the BCS cleared without payment of duty and without any bill. The differential duty demanded on this head is Rs. 1,36,750/-. 4) Annexure-D - details of actual production of SB, SBML and YSS as per the recovered notebook during the period 01.06.1998 to 15.06.1998. The differential quantity, the value and the duty on this count were as follows. DETAILS OF DIFFERENTIAL QUANTITIES BETWEEN NOTE BOOK AND RG-1 PRODUCT DIFFERENTIAL QUANTITY RATE PMT (Rs.) VALUE (Rs.) DUTY (Rs.) SBML ....
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....nrecorded goods have been cleared. As far as Annexure-E is concerned, he would submit that this is based on note book which was maintained for the purpose of making payments to the labour contractor, Shri Ganga for the services rendered by him. The signature of Shir Ganga was not there and during cross-examination it was confirmed that he was an uneducated and cannot read or write. The authenticity of this annexure has not been established by the department. Further, the alleged clandestinely manufactured products must also be set off against the alleged clandestinely removed goods and there cannot be a charge of duty twice - first on the manufacture and again on its removal. He would, therefore, urge that as far as Annexure-E is concerned, they do not subscribe to the authenticity of the records and the department has not been able to establish the same. In view of the above, he pleads that their appeals must be allowed and the impugned order may be set aside. 7. Learned departmental representative reiterates the findings of the OIO. He submits that the assessees were allowed an opportunity to cross-examine the person whose statements were referred to while passing the OIO and ....
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..... "13. Reliance for issue of this notice is based on the following documents,- i. Panchanama dt.16.6.98 drawn at the factory premises of the assessees. ii. Panchanama dt.16.6.98 drawn at the Regd./Admn office premises of the assessees. iii. Statement dated 16.6.98 of Shri E.V. Koteswar Rao, Chemist. iv. Statements of Shri M.V. Ramana Murthy, Central Excise Incharge given on 16.5.98, 14.8.98, 20.8.98 & 24.12.98. v. Statements of Shri M.V. Murali Krishna, Marketing Manager given on 17.6.98, 4.8.98, 12.8.98, 22.8.98, 23.9.98, 26.9.98 & 11.12.98. vi. Statement dated 18.6.98 of Shri D. Venkat Reddy, Partner M/s Kalyani Chemicals, Hyderabad. vii. Letter dated 14.8.98 of Shri M.V. Murali Krishna, Marketing Manager. viii. Statement dated 18.8.98 of Shri K. Krishnaiah, Managing Partner, M/s Kalyani Chemicals, Hyderabad. ix. Statement dated 18.8.98 of Shri Md. Fazal Rahman, Managing Partner, M/s Chromochem, Hyderabad. x. Letter dated 31.8.98 of Shri Md. Fazal Rahman, Managing Partner, M/s Chromochem, Hyderabad. xi. Statements of Shri Ch. Krishna Murthy, Managing Director, M/s Vishnu Ch....
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....cals Pvt Ltd during the year 1997-98 & 1998-99. c) Annexure-C: Details of Sodium Bichromate and Basic Chromium Sulphate cleared without payment of duty and without any bill. 10. All these pertain to alleged clandestine clearances of goods. As far as Annexure-D is concerned, he fairly submits that the notebook in this case was also seized from the premises of the factory and the differential duty was worked out. However, he submits that differential duty worked out as per this annexure alleging that there was excess unrecorded production which must be set off against demand of alleged excess unrecorded clearance as in Annexure-A, B & C. As far as Annexure-E is concerned, he submits that this was a notebook meant for payment to the labour contractor and it cannot form a sound basis for alleging that there was clandestine production and clandestine clearance of the goods. Therefore, the demand on this account is not sustainable. 11. This is a case of alleged clandestine removal of goods. Therefore, it is unthinkable that there will be official records of the clandestine manufacture and clandestine clearance. If these were recorded, they will no longer be clandestine. By....