TaxTMI 
TaxTMI 
TaxTMI 
2020 (3) TMI 901
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....lant on clandestine removal of copper wires. 2. Being aggrieved and dissatisfied by the judgment and order of CESTAT, New Delhi, this Central Excise Appeal Case has been preferred. 3. The Appellant has averred the following substantial questions of law: "(i) Whether the purported searches conducted at the factory premises of the Appellant and the residential premises of the proprietor of the Appellant conducted in violation of provisions of section 18 of Central Excise Act, 1944 read with section 100 (4) of Cr.P.C, as these were conducted in the absence of Panchas, are legal and valid? (ii) Whether the documents purportedly shown to have been recovered at the time of vexatious searches conducted in the absence of Panchas and in violation of provisions of Section 18 of Central Excise Act read with Section 100 of Cr.P.C., be relied upon against the Appellant for confirming the demand of Central Excise Duty? (iii) Whether the demand of Central Excise Duty can be confirmed against the Appellant, merely relying upon the statement dated 08.08.2011 of the proprietor of the Appellant recorded under section 14 of the Central Excise Act, 1944, which was dictated statement by the offi....
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....e absence of evidences such as, whether the Appellant has capacity to manufacture alleged quantity, proof of purchase of inputs, proof of transportation of inputs upto the factory premises of the Appellant, proof of payment of consideration to the alleged supplier of inputs, proof of manufacturing of alleged goods, proof of removal and transportation of alleged goods from the factory premises of the Appellant to the alleged buyer, proof of payment of consideration amount by the alleged buyer to the Appellant and corroboration by the alleged supplier of inputs and buyer of finished goods, contrary to the settled law? (vi) Whether the Ld. Tribunal has committed an error in upholding the demand of Rs. 4,46,93,175/- confirmed by the Ld. Commissioner, relying upon seizure of finished goods valued at Rs. 51,500/- and raw material valued at Rs. 3,27,960/- at the premises of a third person i.e. M/s Reliance Cable Industries, the documents recovered from the third person's premises and statement of its proprietor were not confronted with the proprietor of the Appellant at the time of investigation? (vii) Whether the demand of Central Excise Duty can be confirmed against the Appellan....
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.... from the both factory premises and the residential premises of the Appellant Firm and the proprietor of the said firm respectively. 9. The searches conducted at factory and residential premises of M/s. Reliance Cable Industries and its proprietor, led to the seizure of finished goods worth Rs. 51,500 and raw materials valued at Rs. 3,27,960/- and the recovery of certain documents which were incriminatory in nature. 10. The statement of proprietor of the Appellant firm was recorded on 8th November 2011, 14th November 2011, 30th May 2012, 5th December 2012 and 12th March 2013 under Section 14 of the Act. 11. Based on the investigation conducted and statements of various witnesses including the proprietor of the Appellant firm, a Show Cause Notice (SCN) dated 4th April 2013 was issued by the Commissioner, Central Excise, wherein, a demand of Rs. 4,46,93,75 under Section 11-A of the Central Excise Act, 1944 along with interest under Section 11AA of the Act and proportionate penalty under Rule 25 of the Central Excise Rules, 2002 read with Section 11AC of the Act was raised. 12. The Appellant, thereafter, allegedly preferred multiple requests for documents relied on by the authorit....
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....ch, b. the statements made by the Proprietor of the Appellant firm under Section 14 of the Act, c. unaccounted material recovered from M/s Reliance Cable Industries along with the statement of its proprietor dated 10th August 2011 admitted the purchase of unaccounted goods from the Appellant firm, d. and evidence of transportation of goods through M/s Surya Transport, confirmed the demand made under SCN with the modification that the Rs. 15,00,000 deposited by the Appellant be considered to be appropriated towards the duty to be paid. 18. The Appellant challenged the same, before the CESTAT, on the grounds that the Commissioner had erroneously relied on the documents recovered during the search conducted on 8th November 2011 as the same had been conducted without the presence of the Panch witnesses and thus in sheer violation of Section 18 of the Central Excise Act, 1944 read with Section 100 of the Criminal Procedure Code, 1973. Moreover, it was contended that due to the rejection of the cross examination of the Panch witnesses along with the other departmental witness, their evidences should have been struck from the record as per Order passed by the Commissioner, Central ....
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....ment of Shri Lalit Jain that he had been purchasing both accounted and unaccounted bare copper wire from the Appellants. 8. Though the Appellant has emphasised upon the documents as that of discharge of his VAT liability but the said documents will corroborate only the accounted removal and those documents are also absolutely insufficient for rebutting aforesaid admission of Shri Lalit Jain and admission even of the Appellant himself. There is the admission on part of the Appellant to the extent of admitting the recovery of the entire said document from his factory as well as residential premises with the acknowledgment that the documents are reflecting the sales proceeds of the bare copper wire. Though the Appellant had retracted these admissions but in the absence of any appropriate remedy of protest sought by the Appellant, the retraction cannot be ruled out to be an afterthought. The statement of the proprietor of the noticee has not been recorded once or twice but has been recorded 5 times. Even if the statement as recorded on the date of seizure, i.e. 08.08.2011 is considered to be under threat and pressure. Firstly, there is no evidence by the Appellant to that effect seco....
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....ngth. 24. The Ld. Counsel for the Appellant argued that the searches conducted at the factory and residential premises of the Appellant and proprietor of the Appellant firm were conducted in violation of Section 18 read with Section 100 of the Code of Criminal Procedure since the same were conducted in absence of Pancha witnesses which violates the statutory mandate. The Counsel, further pressed that the documents recovered from these illegal searches could not have been relied upon by the Commissioner, Central Excise to confirm the demand against the Appellant. 25. It was also contended that the statements of Pancha witnesses should have been discarded from the record of the adjudication proceedings since the Revenue had failed to bring the Pancha witnesses for cross examination. Similarly, the statements made by Mr. Ashok Aggarwal, proprietor of M/s Surya Transport were erroneously relied upon by the Commissioner in confirming the demand against the Appellant. 26. Moreover, the validity of the Statement made on 8th November 2011 was challenged as the same was contended to be dictated by the officers of the Central Excise to the brother of the Appellant when the proprietor of t....