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TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 428
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....ticee namely 'Pure Alloys Limited'. 2. Learned counsel for the appellant pointed out that the facts of the case are identical to the facts in the case decided Shri Hari Steel Industries vide order No. A/11053-11055/2022 dated 29.08.2022. He points out that the investigations were initiated after recovery of some diaries from brokers and follow up action was taken on all the manufacturers mentioned in the said diaries of the brokers. He pointed out that various statements were recorded of the employees and brokers, and consequently demands were confirmed by the adjudicating authority on the basis of diaries recovered from the brokers and the statements of the employees. He pointed out that on same set of investigation a number of show cause notices were issued including that in case of Shri Hari Steel Industries (supra). 2.1 He pointed out that no shortage of goods was found in the factory premises of M/s Pure Alloys. He also pointed out that no investigation was carried out at buyers' end in respect of any of the entries in the diaries. He also pointed out that the no other effort was made to corroborate the details of alleged clandestine clearances found in the diaries of th....
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....ase of Bansal Castings. In Bansal Casting while granting relief following has been observed: "4. I have carefully considered the submissions made by both the sides and perused the records. I find that entire case was made out on the basis of search conducted with the third party which is the broker and the records recovered the from the broker. The records of the broker bearing some entries related to some of the goods. Some statement was recorded from the broker. I find that despite the appellant requested for cross examination, the lower authorities have rejected the request. In the present case, the entire evidence was relied upon are documents recovered from the brokers and their statement. In this case, no evidence was found with M/s Bansal Casting Pvt. Ltd. It was incumbent on the Ld. Commissioner to grant the cross examination of the broker as it is mandatory under section 9D. Without cross-examination of the evidence, their statements cannot be relied upon. In the judgment of Rama Shyama Papers Ltd. (supra). cited by Ld. Counsel, he pointed out following para 9 & 10: 9. 9.We have considered the submissions of both the sides. The Revenue has charged the App....
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.... the goods had been brought on record. Thus the statements of the transporters have remained uncorroborated and also suffers from the short coming of being not being cross-examined by the Appellants. It has been the settled law that the liability cannot be fastened on an assessee on the strength of documents seized from the possession of third party. There should be some corroborative evidence/material. The Tribunal has in the case of Emmtex Synthetics Ltd., supra, when the charge of clandestine removal was made against the Appellants therein out of yarn received from a third party based on the diary, loose documents and packing slips allegedly recovered from Shri B.M. Gupta, Vice President of the Supplier Company, held that "no presumption on the basis of uncorroborated, uncross-examined evidence of B.M. Gupta and the alleged entries made by him in the private diary, loose sheets, charts, packing slips could be drawn about the receipt of polyester yarn by the Appellants from the company, M/s. HPL, in a clandestine manner during the period in question. Similarly, no inference could be legally drawn against the Appellants of having manufactured texturised yarn out of the said polyes....
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....k driver Shri Shiv Bahadur Yadav has also not been cross-examined and cleaner Shri Rakesh Kumar had deposed that the Bills/Invoices are supposed to be with the Driver and he being cleaner had no knowledge. 10.The confirmation of duty in respect of 149 consignments is also based on the records seized from the premises of M/s. Chitra Traders and not on the basis of any record seized from the premises of the Appellant-company. The Revenue has not been able to adduce any corroborative evidence to show the movement of goods from the premises of the Appellant-company to the premises of M/s. Chitra Traders or the Customers whom the goods were sent directly to as per the direction of Chitra Traders. No inquiry has also been made into these Customers who ultimately received the goods. There is no substance in the reasoning given by the Commissioner in the impugned order to the effect that "as the party did not challenge the fact of their business association with M/s. Chitra Traders, Delhi, the enquiry further down the line was not considered necessary." The onus of proof that the goods were removed by the Appellants without payment of duty and without entering the same in their re....
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....tion in the case of Moon Beverages wherein the charges of clandestine removal was made on the basis of computerized sheets of sales figures maintained by M/s. Parle Exports Ltd. whom the figures were sent by the assessee, the Tribunal has held that "the charge of clandestine removal cannot be established on the basis of one single factor.....Other corroborative evidence such as evidence of other inputs required for manufacture of aerated waters namely sugar, carbon dioxide being purchased and utilized in the manufacture of the final 7 E/12133, 12451 & 12559/2010-SM product during the period in dispute is required. There is no such corroborative evidence in the present case. There is also no evidence of higher electricity consumption." In the present appeal before us also there is no corroborative evidence except the PMX Reports. Revenue has also not contradicted the submission of the learned Advocate that the Managing Director of the Appellants was not even questioned about these reports. In the case of Rama Shyama Papers Ltd, supra, wherein the records were seized from the premises of one of the customer of the assessee, the Tribunal did not uphold the charge of clandestine remova....
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....red from the assessee, no record showing procurement of raw material for manufacturing of goods, extra payment to labourers, electricity consumption, transportation, etc. the clandestine removal was set aside. The facts more or less of the above judgment is similar to the facts of the present case. Similarly, in the case of Vishva Traders Pvt. Ltd. (supra), the Tribunal has held that in absence of the record to show purchase of raw material for manufacture of final products but when there is no statement of raw material suppliers, in this regard, the persons whose 8 E/12133, 12451 & 12559/2010-SM statements were recorded have not been produced for cross-examination, there is no investigation to indicate unusual use of electricity, it was held that no tangible goods to indicate that there was clandestine removal of goods. Accordingly, the demand and penalty were set aside. It was also observed that even though the transporter's statement was recorded but the transporter has not specifically accepted that the goods were transported from assessee's factory and only general statement was given by the transporter, particularly, when the transporters were not allowed a cross-examination,....