TaxTMI 
TaxTMI 
2021 (12) TMI 1010
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....har) and also at the premises situated at 212 Second floor, Ashiana Tower, Exhibition Road, Patna.( Which is being referred to as the "secret office‟ of the Appellant no.1). Apart from these two places, the residence of the Appellant No. 2, Shri Sudhir Kumar Garg director of M/s Garg Rerollers Pvt. Ltd. was also searched. All these three searches were conducted simultaneously on 24.07.2013. During search of the above mentioned three premises on 24.07.2013, the Officers recovered and seized loose handwritten sheets of paper, Loose slips, Spiral pocket notebooks/notepads, Kaacha Register, Petty cash sheet/Private cash registers etc. On the day of search i.e on 24.07.2013, statement of Sri Vijay Kumar Sinha and Sri Prabhat Kumar Singh, both employees of the said Garg Rerollers Pvt. Ltd. and of Shri Sudhir Kumar Garg, Director of the company were recorded. A further statement of Shri Sudhir Kumar Garg was also recorded on 29.07.2015. After examining the said private records recovered and seized from the said three premises, a Show Cause cum demand notice was issued to both the appellants vide DGCEI F. No. 123/KZU/KOL/JRU/Gr-F/15/6497 dated 15.12.2017. By the said show cause notic....
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....written Submissions filed by the Appellants and by the Revenue. 6. We find that the demand has been raised for alleged clandestine removal of the finished excisable goods from the factory of the Appellant No.1 for the period 18.12.2011 to 31.08.2012 and from 01.10.2012 to 23.07.2013. Physical stock verification was done at the factory of the Appellant No.1 on the day of search i.e on 24.07.2013. From the records we also find that during the relevant period the Appellant No. 1, as per the allegations in the show cause notice and the confirmation thereof by the learned adjudicating authority, removed 9,924.836 MT of Finished excisable goods i.e MS bars and rods, MS angles, MS flats, MS rolls and 354.665 MT of rolling waste clandestinely by way of wilful misstatement and suppression of facts and on such grounds the demand of duty of Rs. 3,92,46,461 has been confirmed by the Impugned order. 7. From the show cause notice and the impugned order dated 19.06.2018, we observe that the entire plank of the case rests on the private loose documents/ Papers which were recovered and seized during searches on 24.07.2013 and the statements of Sri Vijay Kumar Sinha, Sri Prabhat Kumar ....
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....p of those evidence the statements of Shri Garg and others. The appellants requested for cross-examination of all those persons whose statements were recorded as well as the Panchas, which were relied upon by the Revenue. However, none of them could be presented by the Revenue for cross examination by the appellants. In this respect we find that the learned Adjudicating authority has held that if sufficient corroborative evidences exist, then cross examination of the deponent of the statements is not necessary and he placed his reliance on the judgement of the Hon‟ble High Court of Bombay in the case of Sharad Ramdas Sangle [2017(347)ELT 413 (Bom.)] wherein it was, inter alia, held that - "It is seen from the records that the entries made in the private accounts where corroborated by Shri Ramdas ShivramSangle, Director of the appellant firm and Shri Sharad Ramdas Sangle, Proprietor of M/s Ambica Scrap Merchant through whom clandestinely remove goods were sold, wherein they had admitted that the entries recorded are true and correct and pertain to the unaccounted production, purchase of raw materials without accounting and sale of finished goods in cash without payment of du....
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....s been made by the appellant on the Final Order numbers 1419-1421/2012-SM(BR)(BP), dated 04.10.2012 passed by the Tribunal in the case of Vikram Cement(P) Ltd. Vs Commissioner of Central Excise Kanpur 2012 (286) E.L.T. 615 (Tri. - Del.). Upheld by Hon‟ble High Court of Judicature at Allahabad in the said case it has been inter alia held that: "8. As regards clandestine removal, Revenue's case is based upon recovery of some loose sheets during the course of search of the Factory. I have seen the said loose papers which are relied upon documents in the show cause notice. On going through the said loose documents, I find that there is no indication to show that the same belong to cement. Revenue has taken into consideration the statement of director, which is to the effect that number of bags, figures reflected in the said loose paper. Relate to the cement which stand cleared by them clandestinely. 9. The issue required to be decided is as to whether the said statement alone can be made the basis for arriving at the finding of clandestine removal. What is evidentiary value of the said statement in the absence of other corroborative evidence on record. The Hon'ble Delhi....
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.... on statements alone and without undertaking further investigation. 13. Plethora of judgements have held that it is for the Revenue to establish the case of clandestine removal by production of concretes and tangible evidence. I find that apart from loose paper, which in the face of it cannot be related to the appellants business accounts and the sole statement of the director, there is no other evidence to reflect upon the clandestine activities of the appellants. The appellants have also taken stand that it is beyond their capacity to manufacture more than 1000 MT tons per month and as such the revenues allegations that they cleared more quantity in the month of February 2004 must be taken with the pinch of salt. In the view of the forgoing discussion, I set aside the confirmation of demand against the appellant and in position of penalties upon them." The Appellant submitted their defence contentions in reply to the allegations in Show cause notice in Paragraph 5.0 of their written submissions filed before this bench. 12. We find that the above-mentioned Judgements and orders squarely cover the case of the appellants herein. We observe that no positive independ....
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....h aside the fact of seizures of private loose documents/papers. 15. The Appellants strongly relied upon the Judgement of Hon‟ble Delhi High Court in Flevel International v/s CCE reported in 2016(332) ELT416 (DEL) which has relied upon the landmark decision of the Tribunal in the case of Arya Fibres Pvt Ltd. V/s CCE reported in 2014 (311) ELT 529(T). The Legal position has been summarized as under - "(i) There should be tangible evidence of clandestine manufacture and clearance and not merely inferences or unwarranted assumptions; (ii) Evidence in support thereof should be of : (a) raw materials, in excess of that contained as per the statutory records; (b) instances of actual removal of unaccounted finished goods (not inferential or assumed) from the factory without payment of duty; (c) discovery of such finished goods outside the factory; (d) instances of sale of such goods to identified parties; (e) receipt of sale proceeds, whether by cheque or by cash, of such goods by the manufacturers or persons authorized by him; (f) use of electricity far in excess of what is necessary for manufacture of good....