TaxTMI 
TaxTMI 
2021 (10) TMI 585
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....ory premises of the appellant regarding search carried out by them. The officers have also seized stock of finished goods lying in the factory under the belief that the clearance value during 2012-13 & 2013-14 has exceeded the limit of SSI Exemption notification and hence liable to confiscation. Thereafter, two different show cause notices were issued, one for seizure portion and other for demand of duty and proposing penalty on the appellant as well as on others. The Show Cause Notice has relied upon various documents recovered from various places during the investigation. The Adjudicating Authority i.e. Commissioner passed Order-In-Original confirming the demand with interest and penalty and also imposing redemption fine in lieu of confiscation of the goods. The Commissioner has also imposed personal penalty on the directors of the appellant and also on the others. The ground for confirmation of demand is that the appellant have clandestinely removed the goods which resulted into exceeding the threshold limit of SSI Exemption due to which the appellant is not eligible for SSI Exemption. The appellant M/s. Meera Pipes Pvt. Ltd along with others being aggrieved by the Order-In-Orig....
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....en subsequently on 13.12.13 he appeared before officer obeying the summon issued to him for his statement, the statement also shows the same and while recording the statement he denied to admit the Diary No. A/2 & A/3 of panchnama and its contents as it was not owned or written by him. Thus, his denial of said diary cannot be said non-cooperation but the officers alleged the same as he has not admitted. He submits that there is no admission by any person of the appellant company about the details of Diary A/2 & A/3 therefore, the same cannot be admitted acceptable as evidence against the appellant. 2.2. He further submits that similarly the document shown as recovered on 27.09.12 from the transporter Jay Bhavani Freight Carriers, Mumbai & Ahmedabad much prior to investigation started against the appellant without ownership or admission by the appellant company not admissible as evidence against the appellant. All records of transporter referred/relied upon in the notice and by the Commissioner are of the transporter only and not of the appellant and therefore, it is not admissible as evidence without any admission by the appellant. He submits that when the Commissioner alleged t....
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....s by the appellant. 2.3 He submits that as regard the documents of Shri Ram Weigh Bridge which were heavily relied upon to establish the illicit procurement of raw material, he submits that the documents of Shri Ram Weigh Bridge are not admitted anywhere by the appellant. Even the comparative chart prepared by the Investigating Officer regarding entries of two diaries and weigh bridge slips also not admitted or confirmed by the appellant. He submits that the investigation at Shri Ram Weigh Bridge is also under serious doubt as for the reason that though the officers visited on 27.11.13 when no document was found subsequently, again on 29.11.2013 during the visit to Shri Ram Weigh Bridge they gathered/created evidences as per their requirement against the appellant. He further submits that the documents and statements procured from Shri Ram Weigh Bridge are not admissible as evidence against the appellant particularly in absence of cross-examination of the person of Shri Ram Weigh Bridge and in absence of any admission about its contents by the appellant. 2.4 He submits that the Commissioner has also erred in relying the documents and statements of raw material suppliers. The ....
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.... Moreover, the documents procured from M/s.JBFC were much prior to the search made at the place of the premises of the appellant M/s.Meera Pipes P Ltd. as in OIO it is stated that during the search on 27.09.2012 at M/s.JBFC, various documents regarding clearance by M/s. Meera Pipes P Ltd. were also recovered for the period from 22.10.2011 to 20.09.2012. Regarding the clearance of 987.84MT of SS pipes, he submits that nowhere any such documents in the name of M/s. Meera Pipes P Ltd. mentioned or any other supporting evidence of M/s. Meera Pipes P Ltd. found and just on the basis of statement of the persons of M/s. JBFC, the clandestine clearance was confirmed by the Commissioner. 2.7 He also submits that the Commissioner has denied the cross-examination of the persons of M/s.JBFC though the documents and statements are heavily relied upon by the Commissioner therefore, the Commissioner has grossly erred in relying upon the third party evidence by denying their cross-examination and without any admission by the appellant. 2.8 He further submits that normally in the case of clandestine removal, the transporter who indulge in transporting illicit goods are also penalized under Ru....
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....deciding at para 76 of the order that during the period from 01.04.2013 to 27.11.2013 M/s. Meera Pipes P Ltd. illicitly procured 874268.160Kgs of raw material and illicitly manufactured and clandestinely cleared 940518.224 Kgs of finished goods. It is not possible in the metal industries to produce more quantity of finished goods than the quantity of raw material and on this ground also observation of the Commissioner is totally incorrect and without going through the process of manufacture as there is always a processing loss in the metal industries. He submits that since clandestine removal is not established the confiscation of finished goods placed under seizure at the time of panchnama on 27.11.2013 and imposing redemption fine and penalty on the appellant is totally incorrect and illegal. He submits that since the appellant have not crossed the SSI exemption limit of Rs. 1.5 crore under SSI exemption notification No. 8/2003 the appellant was not required to obtain any Central Excise Registration under Central Excise Rules. Accordingly, the demand, interest, penalty and redemption fine are not sustainable. He prays to set aside the impugned order and allowed the appeal. In ....
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....MD) MOONTEX DYEING & PRINTING WORKS VS. CCE, SURAT • 2008 (225) ELT 57 (ALL)- GLOBAL SPIN WEAVE LTD VS. CESTAT • 2006 (193) ELT 478 (TRI-DEL)- GLOBAL SPIN WEAVE LTD VS. CCE, GHAZIABAD • 1983 (13) ELT 1546 (SC) - CC, MADRAS & OTHERS VS. D. BHOORMULL • 2017 (358) ELT 2014 (TRI-BANG) - USMAN SULEIMAN DARVESH VS. CCE, CALICUT • 2020 (372) ELT 321 (CHATTISGARH)- N R SPONGE P LTD VS. CCE, RAIPUR • 2019 (368) ELT A155 (SC)- ERODE ANNAI SPINNING MILLS P LTD VS. COMMISIONER • 2019 (366) ELT 647 (MAD)-CCE, SALEM VS. CESTAT, CHENNAI • 2018 (362) ELT 559 (MAD)-LAWN TEXTILE MILLS P LTD VS. CESTAT CHENNAI • 2015 (316) ELT 534 (GUJ) -KRISHNA SCREEN ART VS. CCE • 2015 (316) 417 (GUJ)- TULIP LAMKRAFT PVT LTD VS. CCE • 2010 (258) ELT 198 (GUJ)- R A SHAIKH PAPER MILLS PVT LTD VS. UNION OF INDIA • 2010 (256) ELT 20 ( GUJ )- BHAVIN IMPEX PVT LTD VS. UNIO OF INDIA • 2009 (239) ELT 429 (GUJ)- UMIYA CHEM INTERMEDIATE VS. CCE 04. We have carefully considered the submissions made by both the sides and perused the records. The department's....
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....nation. Once the Director of the appellant company has clearly disowned the diary and contents therein, it is incumbent of the Adjudicating Authority to cross examine third party witness to bring the truth of the diary on record. However, by not allowing the cross examination, the Adjudicating Authority has violated the basic requirement of cross examination for admitting any evidence such as statement of third part. It is the settled law that in terms of section 9D, it is mandatory on the part of the Adjudicating Authority to cross examine the witness or admitting their statements as evidence. Some of the judgments and relevant orders are reproduced below:- • HI TECH ABRASIVES LTD. VS. COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS, RAIPUR-2018 (362) E.L.T. 961 (CHHATTISGARH) 9.4 The legislative scheme, therefore, is to ensure that the statement of any person which has been recorded during search and seizure operations would become relevant only when such person is examined by the adjudicating authority followed by the opinion of the adjudicating authority then the statement should be admitted. The said provision in the statute book seems to have been made to ser....
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....ng authority in the proceedings instituted upon show cause notice was not recorded nor formation of an opinion that it requires to be admitted in the interest of justice. In taking this view, we find support from the decision in the case of Ambica International v. UOI rendered by the High Court of Punjab and Haryana. Reliance has been placed by the Counsel for the Revenue on the decision in the matter of Commissioner of Central Excise v. Kalvert Foods India Private Limited (Laws (SC) 2011 838) = 2011 (270) E.L.T. 643 (S.C.). That decision turned on its own facts. In para 19 of the judgment, it was concluded as below : "19. We are of the considered opinion that it is established from the record that the aforesaid statements were given by the concerned persons out of their own volition and there is no allegation of threat, force, coercion, duress or pressure being utilized by the officers to extract the statements which corroborated each other. Besides the Managing director of the Company of his own volition deposition the amount of Rs. 11 lakhs towards excise duty and therefore in the facts and circumstances of the present case, the aforesaid statement of the Couns....
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.... BHAVNAGAR - 2014 (314) E.L.T. 449, the charge of clandestine removal was made on the basis of Director's statements which was subsequently retracted in cross examination of buyers and suppliers of raw material, the tribunal set aside the demand and allowed the appeal. Applying the ratio of the above judgment in the present case also even there is no confessional statement of the director who categorically disowned the diaries which was heavily relied upon by the revenue and also the witness like buyers and transporters were not cross examined. This judgment was affirmed by the hon'ble Gujarat High Court as reported in 2015 (322) ELT 283 (Guj. High Court). 4.5 In the case of CHHAJUSINGH S. KANWAL-2011 (272) E.L.T. 202 (GUJ.), since the demand was raised mainly on the statements of dealers and transporters who were not examined and the demand was set aside. Therefore, it is a trite law that any statement can be admissible evidence only when the person who has given any statement is cross examined by the Adjudicating Authority. 4.6 In the case of GUJARAT CYPROMET LTD. -2017 (345) E.L.T. 520 (GUJ), the hon'ble High Court has held that without giving the cross examination even th....
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.... Central Excise Act therefore, without cross examination neither the statements nor the documents recovered from transporter and dealers can be relied upon. The learned counsel also taken us to some sample documents which are heavily relied upon by the adjudicating authority for confirmation of demand. Some of the same documents are scanned below: 4.10 As regard the above diary which was recovered from M/s. JBFC Transport Company, the adjudicating authority only on the basis of name 'Assu' which Department refered to Ashuram, Director of M/s. Meera Pipes P Ltd. is mentioned on the documents concluded that these are related to the appellants. This conclusion of the adjudicating authority is on the basis of confirmation made by employees of M/s. JBFC. As we stated above since the statements on these persons have not been examined their statements cannot be relied upon. Therefore, neither the appellant's/company's name nor the full name of the director is appearing, merely because word 'Assu' is appearing on the document cannot be concluded that this detail mentioned in the said document is related to the appellant. Sample transport document is scanned below:- From the above ....