2020 (10) TMI 436

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.... An intelligence was gathered that the appellant alongwith some other manufacturer were indulging in large scale of evasion of Central Excise duty by clearing their finished goods clandestinely through a broker namely Umesh Modi. Search was conducted at various places including the alleged factory premises of the appellants and some private records were seized. Statements of various brokers viz. Vijay Jindal, Harish Gandhi and Pradeep Saraogi were recorded alongwith the statement of Shri Pravesh Gautam, Director of the Appellants who alleged to have admitted his involvement in the clandestine manufacture of the finished goods i.e. M.S. Ingots and clandestine clearance of the same between August, 2006 to December, 2006. But later on at the f....

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.... co-noticees including the penalty of Rs. 1 lac on the Appellant under Rule 26 ibid. The said order was challenged by the Appellant only before the Commissioner (Appeals) and the learned Commissioner vide impugned order dated 12.10.2018 dismissed the Appeal and upheld the penalty u/r. 26 ibid. 5. Learned Counsel for the Appellants submits that there is gross violation of the principle of natural justice and despite the remand by this Tribunal for denovo adjudication, the cross-examination was not permitted by the revenue. He further submits that since inception of the adjudication proceedings in the 1st round, the Appellants are asking for the cross-examination but it was not granted to them despite the order of this Tribunal. He also subm....

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....no one from the said company was examined to establish that it belongs to the Appellant only. It has been specifically recorded in the impugned order that penalty on the appellant u/r. 26(2) has been imposed based on revelations made under various statements. The writer of the chits/private documents was not examined therefore it raises doubt whether the same can be used against the appellants. Mere recovery of private records is not sufficient to prove clandestine removal and a concrete and clinching evidence is required to prove such allegation and it is for the department to discharge the burden and prove the charges of clandestine removal against the appellants. The department has to prove the allegation on the basis of cogent corrobora....

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....ation was denied therefore it vitiates the proceedings qua the appellants. The Hon'ble High Court of Judicature at Allahabad in the matter of C.C.E., Meerut-I v. Parmarth Iron Pvt. Ltd;. 2010 (260) E.L.T. 514 (All.), relying upon the law laid down by the Hon'ble Supreme Court in cases of Arya Abhushan Bhandar v. U.O.I; 2002 (143) E.L.T. 25 (S.C.) and Swadeshi Polytex Ltd. v. Collector, Central Excise; 2000 (122) E.L.T. 641 (S.C.) and of the Hon'ble High Court of Judicature at Bombay in case of Gyan Chand Sant Lal Jain v. U.O.I; 2001 (136) E.L.T. 9 (Bom.), has held that at the stage of adjudication, it is the right of an assessee to seek cross-examination of the witnesses whose statements are sought to be relied upon by the Revenue and that ....