2022 (10) TMI 318

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ire/ Rod/ Pipe/tube without cover of the Central Excise invoices, without payment of Central Excise Duty and without accounting for the same, in their books of account, searches were conducted by the officers of DGCEI at the premises of M/s Metal Gems and M/s Moongipa Roadways Pvt. Ltd. and also seized several records and documents. The officers recorded the statements of various persons including employees and partners of the Appellant and also the transporters, amongst others. 1.2 The documents recovered from M/s Moongipa Roadways Pvt. Ltd. were scrutinized and it appeared that they are engaged in the transportation of the consignment of Copper Pipes/ tubes/ coils from M/s Metal Gems, Daman. They have been showing the name of /details of the consignor and consignee when the goods are covered under proper central excise invoices and whenever the goods are not covered under proper invoices, they have been showing the consignment to have been booked in abbreviated form such as NKD, RKD, SMD, MKD, Lalitbhai, PD, KK, AE, etc. they have admitted that the consignment which have been transported by them under the abbreviated names have been received by them, for transportation, withou....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....rm under 63 code names, in respect of such code names no investigation has been done by the department apart from three parties, from whom nothing incrementing regarding the clandestine clearance of goods was found, therefore, in such circumstances demand of duty in respect of entire consignments allegedly cleared under 63 code names cannot be made against the Appellant. Shri Ramnivas Sharma, Manager in M/s Moongipa Roadways in his cross -examination in answer to question 14 stated that 'code name' mentioned by them was as per the instruction of Shri J.K. Yadav from their Mumbai office and in answer to question 15 he stated that they used to transport copper pipe for other parties as well as M/s R.R. Cables, M/s Salasar Copper, M/s Mandev Metals, M/s Parasmani, M/s Jalan etc., Most importantly in his answer to question 16 he mentioned that they used to transport goods for above parties in 'code name' only. Thus it is unambiguously clear that when details of various parties are mentioned in the loading register in code names than solely on the basis of loading register demand of clandestine clearance of goods cannot be made against Appellant. Hence demand is not sustainable on this ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... settled law that documents recovered from a third party can be used against the manufacturer to prove clandestine removal only when these are supported with corroborative evidences. The Revenue has alleged that huge quantity of finished products have been manufactured and cleared clandestinely without payment of Central Excise duty. The booking register/loading register recovered from the business premises of transporter, no doubt, gives rise to suspicion that these are details relating to clandestine clearance of the goods. However, clandestine manufacture and clearance alleged against the appellant is a very serious charge which needs to be proved by Revenue by producing tangible and reliable evidences. For clandestine clearance of such huge quantities of finished products, corresponding quantity of raw materials ought to have been procured by the appellant. The finished products allegedly have been cleared to various customers. In fact, in the said transporter records it revealed that clearances under abbreviated name have been effected under 63 code names, the investigation has been conducted only in respect of 3 codes, no investigations were conducted in respect of remaining ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ther by cheque or by cash, of such goods by the manufacturers or persons authorized by him; (f) use of electricity for in excess of what is necessary for manufacture of goods otherwise manufactured and validly cleared on payment of duty; (g) statements of buyers with some details of illicit manufacture and clearance; (h) proof of actual transportation of goods, cleared without payment of duty; (i) links between the documents recovered during the search and activities being carried on in the factory of production; etc." The aforesaid ratio also finds support in the following judgments : • VISHWA TRADERS PVT. LTD. V. CCE, 2012 (278) E.L.T. 362 (T), AS AFFIRMED BY THE HON'BLE GUJARAT HIGH COURT IN CCE V. VISHWA TRADERS, 2013 (287) E.L.T. 243 (GUJ.), • SAKEEN ALLOYS PVT. LTD. V. CCE, 2013 (296) E.L.T. 392 (T), WHICH HAS BEEN AFFIRMED BY THE HON'BLE GUJARAT HIGH COURT IN CCE V. SAKEEN ALLOYS, 2014 (308) E.L.T. 655 (GUJ.), • MAHESH SILK MILLS V. CCE, 2014 (304) E.L.T. 703 (T), AS AFFIRMED BY THE HON'BLE GUJARAT HIGH COURT IN CCE V. MAHESH SILK MILLS, 2015 (319) E.L.T. A52 (GUJ.) • CCE V. AIR CARRYI....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....2005 (182) E.L.T. 64 (TRI.-DEL.) 4.2 We also find that in present matter Appellant had sought cross- examination of 18 deponents out of which department could only produce 4 deponents for cross-examination. It is well settled law that though the statements carry good persuasive value but such untested statements cannot be made stand-alone basis for arriving at an adverse conclusion against the assessee. Though an admission or a statement is one of the important piece of evidence but the same has to bear the test of veracity through the tool of cross examination. Further, as per various decisions, it is well settled law that no reliance can be placed on the deponents' statements unless he is allowed to be cross examined for testing the correctness of his statement. Reference in this regard can be made to the Hon'ble Supreme Court's decision in the case of Godrej Pacific Tech Ltd. v. Computer Joint India Ltd. - 2008 (228) E.L.T. 507 (S.C.); Shalimar Rubber Industries v. Collector of Central Excise, Kochin - 2002 (146) E.L.T. 248 (S.C.); Arya Abushan Bhandar v. UOI - 2002 (143) E.L.T. 25 and Laxman Export Ltd. v. Collector of Central Excise - 2002 (143) E.L.T. 21 (S.C.). In all the....