TaxTMI 
TaxTMI 
2022 (5) TMI 648
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....of 2019, 10969 of 2019, 10970 of 2019, 11060 of 2019, 11260 of 2019, 11329 of 2019, 11330 of 2019, 11662 of 2019, 11665 of 2019, 11693 of 2019, 11785 of 2019, 11813 of 2019, 11888 of 2019, 11963 of 2019, 11968 of 2019, 12134 of 2019, 12135 of 2019, 12201 of 2019, 12202 of 2019, 12203 of 2019, 12212 of 2019, 12214 of 2019, 12228 of 2019, 12259 of 2019, 12319 of 2019, 12320 of 2019, 12323 of 2019, 12336 of 2019, 12445 of 2019, 12469 of 2019, 12470 of 2019, 12497 of 2019, 12498 of 2019, 12562 of 2019, 12565 of 2019, 12599 of 2019, 12635 of 2019, 12636 of 2019, 12736 of 2019, 10200 of 2021, 10268 of 2021, 10269 of 2021, 10270 of 2021, 10278 of 2021, 10504 of 2021 ORDER The following appeals are arising out of orders wherein a common investigations/evidences were relied upon therefore, they are taken up together for disposal. A chart showing the details of Appeals and demand therein is as under:- Sr. no Name Appeal No Impugned Order Date Duty Penalty 1 Vinodbhai Amarshibhai patel E/10924/2019 OIA : BHV-EXCUS-000-APP-016-019-2019 24/01/2019 0 165....
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....harbhai Sheth E/11556/2018 OIA : BHV-EXCUS-000-APP-142-147-2017-18 27/02/2018 0 107114 22 Bharat Manharbhai Sheth E/11727/2018 OIA : BHV-EXCUS-000-APP-228-231-2017-18 26/03/2018 0 764606 23 Bharat Sheth E/11462/2016 OIA : BHV-EXCUS-000-APP-002-16-17 15/04/2016 0 19500 24 Jivrajbhai R patel E/11316/2018 OIA : BHV-EXCUS-000-APP-228-231-2017-18 3.9.2018 0 4785885 25 Jivrajbhai R patel E/11502/2018 OIA : BHV-EXCUS-000-APP-139-141/2017-18 19/02/2018 0 3834615 26 Vinodbhai Amarshibhai patel E/11514/2018 OIA : BHV-EXCUS-000-APP-139-141/2017-18 19/02/2018 0 1097853 27 Madhav Industrial Corporation E/11313/2018 OIA : BHV-EXCUS-000-APP-139-141/2017-18 19.2.2018 3834615 3834615 28 Madhav Steel E/11315/2018 OIA : BHV-EXCUS-000-APP-228-231-2017-18 9.3.2018 4785882 4785882 29 Mahendra Ambalal Rana E/12565/2019 OIA : BHV-EXCUS-000-APP-188-195-2019 27/06/2019 0 796849 30 Kishorbhai Amarshibhai Patel E/12562/2019 OIA : BHV-EXCUS-000-APP-176-179-2019 21.6.2019 0 232080 31 Kishorbhai Amarshibha....
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.... 51 Vinodbhai Amarshibhai patel E/10852/2019 OIA : BHV-EXCUS-000-APP-337-339-2018-19 24/12/2018 0 46276 52 Priya Blue Industries P Ltd E/12134/2019 OIA : BHV-EXCUS-000-APP-168-172-2019 21/06/2019 10323438 10323438 53 Sanjay P Mehta E/12135/2019 OIA : BHV-EXCUS-000-APP-168-172-2019 21/06/2019 0 6097913 54 Vinodbhai Amarshibhai patel E/10856/2019 OIA : BHV-EXCUS-000-APP-343-346-2018-19 27.12.2018 0 500000 55 Bharat Manharbhai Sheth E/10281/2019 OIA : BHV-EXCUS-000-APP-233-235-2018-19 14/08/2018 0 31378 56 Bharat Manharbhai Sheth E/10614/2019 OIA : BHV-EXCUS-000-APP-241-18-19 23/08/2018 0 1572839 57 Vijaykumar Kakaram Bansal E/10970/2019 OIA : BHV-EXCUS-000-APP-048-053-2019 27.2.2019 0 1122578 58 Vinodbhai Amarshibhai patel E/10504/2019 OIO : BHV-EXCUS-000-COMM-007-2020-21 23/03/2018 0 2891968 59 Mahendra Ambalal Rana E/10278/2021 OIA : BVR-EXCUS-000-COMM-007-2020-21 26/11/2020 0 2000000 60 Shree Ram Steel & Rolling Industries E/10270/2021 OIA : BVR-EXCUS-000-COMM-007-2020-21 26/11/2020 ....
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....of the cases in brief, as per records are that the appellants are engaged in the process of obtaining goods and materials by breaking of ships, boats and other floating structures. DGCEI gathered intelligence which indicate that most of ship breaking units are engaged in large scale of evasion of Central Excise Duty. DGCEI conducted the coordinated search operations of some of major brokers at Bhavnagar. Officers conducted the search at office premises of appellants and documents were seized for further investigation. Search operations at premises of transporters also carried out. Based on the Trip/Booking registers of seized / produced by transporters enquiries were made with the various Brokers and statements of various persons have also been recorded. Based on the entries appearing in the Trips/Booking Registers of transporters a worksheet was prepared showing the booking truck/ vehicles for loading of goods made by or on behalf of the appellants. The details of worksheet were compared with the invoices of appellants. During the comparison of said booking registers of transport agent it was found by the investigation that in respect of some of the entries made in such booking re....
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.... in respect of vehicle so booked. Further, on being shown entries of vehicles in Register maintained by Gujarat Maritime Board, the Partner of the appellants stated that such entries merely show that a given vehicle had entered the Alang Ship recycling yard but such entries cannot in themselves be evidence of the fact that the given vehicle was loaded at the appellants' plot because in cases of last minute cancellation of orders by the buyers or for any other reasons, the vehicle would not be loaded from the appellants' plot and may go to some other Plot for being loaded. The appellants' Partner categorically stated that the Trucks mentioned in Annexure T.R.1.2 were not loaded from the appellants' unit. He further submits that it is settled law that clandestine removal cannot be established on the basis of third party's records. He placed reliance on the following judgments: • SULEKHRAM STEELS P. LTD v CCE,- 2011 (273) ELT 140 • CHARMINAR BOTTLING CO.P. Ltd. V CCE- 2005 (192) ELT 1057 • RAMA SHYAM PAPERS LTD v CCE- 2004 (168) ELT 494 • STAR ALLOYS & CHEMICALS P.LTD v CCE- 2019 (21) GSTL 174 • ATUL BANSAL v CCE- 2019 (....
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....rom the residence of Broker, Shri Vinod Patel, he submits that only on this basis demand is not tenable. He submits that Shri Vinod Patel has not been examined under Section 9D of the Central Excise Act, 1944 therefore his statement cannot be relied upon. Regarding documents, it is his submissions that there is no corroboration with the said documents such as no buyer was identified except one i.e. Maruti Metal who was also not examined under Section 9D. No evidence with regard to the transportation of the goods. Moreover the statement of appellant's representative is exculpatory. On reliance of third party records, he reiterates reliance on judgments cited in the above paras. 2.4 As regards demand on the allegation of undervaluation of excisable goods on the basis of rates published in the publication by M/s. Major and Minor, he submits that excise duty was paid on the transaction value which is in terms of Section 4 of the Central Excise Act, 1944. He submits that in section 4 or under any law there is no concept of deemed normal price. He submits that there is no evidence whatever to show that any amount over and above the invoice price/transaction value was recovered/ receiv....
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....st the name of the appellant and transporters and brokers have admitted in their statements recorded by the department specifically that they have loaded and transported the said alleged goods without the cover of invoices from the premises of the appellant. However, department has not produced any loading advices or consignment notes issued by the transporters in respect of alleged quantity of excisable goods. Further on a careful consideration of the facts and records, we notice that mere entries found recorded in the records of said Transporters and brokers are not sufficient to confirm the demand of duty and allegation of clandestine removal. It is well settled law that there has to be some evidence in the form of receipt of raw materials, shortage of raw materials, clandestine manufacture including use of electricity, excess or shortage of inputs found in the stock, flow back of funds, purchase of final products by parties alleging receipt and removal of goods and any such evidence which would show clandestine manufacture of goods. Mere entries in third parties' records of Transporters and brokers cannot be basis for clandestine removal. 4.1 It is settled law that documents....
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....fit of doubt goes in favour of the appellant. In these circumstances, we hold that Revenue has failed to prove their case. 4.3 We also find that the law as to whether the third party records can be admitted as an evidence for arriving at the findings of clandestine removal, in the absence of any corroborative evidence, is well established. Reference can be made to Hon'ble Allahabad High Court decision in the cases of Continental Cement Company v. Union of India - 2014 (309) E.L.T. 411 (All.) as also Tribunal's decision in the case of Raipur Forging Pvt. Ltd. v. CCE, Raipur-I - 2016 (335) E.L.T. 297 (Tri. - Del.), CCE & ST, Raipur v. P.D. Industries Pvt. Ltd. - 2016 (340) E.L.T. 249 (Tri. - Del.) and CCE & ST, Ludhiana v. Anand Founders & Engineers - 2016 (331) E.L.T. 340 (P & H). It stands held in all these judgments that the findings of clandestine removal cannot be upheld based upon the third party documents, unless there is clinching evidence of clandestine manufacture and removal of the goods. 4.4 We further found that in the present case, there is no evidence recovered from the appellant manufacturers. The entire case was made out on the basis of third party records and ....
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....s not for the Tribunal to have guess work as to for what purposes the appellant wanted to cross-examine those dealers and what extraction the appellant wanted from them. 7. As mentioned above, the appellant had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of cross-examination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of cross-examination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17-3-2005 [2005 (187) E.L.T. A33 (S.C.)] was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving it....
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....ovisions of Section 138B of the Customs Act, 1962 which would be applicable in the present case. 12. Section 138B of the Customs Act, 1962 reads as under :- "138B. Relevancy of statements under certain circumstances. - (1) A statement made and signed by a person before any gazetted officer of customs during the course of any inquiry or proceeding under this Act shall be relevant for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains, - (a) When the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the court considers unreasonable or (b) When the person who made the statement is examined as a witness in the case before the court and the court is of opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interest of justice. (2) The provisions of sub-section (1) shall so far as may be apply in relation t....
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....order/opinion formed by the quasi judicial authority is subject to judicial review by the appellate authority. The aggrieved party can always challenge that in a particular case invocation of such a provision was not warranted." In view of the above settled legal position, it was incumbent upon the adjudicating authority to grant cross-examination to the appellant. However, firstly since the evidence relied upon are of third party and secondly, any cross-examination of those third parties were not allowed. Accordingly, the revenue failed to establish its case by not giving cross examination. Hence, the demand confirmed against the appellants are not sustainable. 4.5 As regard the demand of Central Excise Duty on the ground of undervaluation of the goods, we find that the differential duty demand on this count was worked out by the revenue on the difference of invoice value of the Appellants and steel rate published in the publication of M/s Major & Minors. The data given by M/s Major & Minors indicates the daily prices for various sizes of rolling plates as well as mixed melting scraps obtained out of ship breaking activities. After comparing both data revenue found that Appe....