TaxTMI 
TaxTMI 
2000 (4) TMI 71
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....he appellants is that on visit of the jurisdictional officers to the factory and on verification of the stock they found shortage of 5070 Mtrs of HDPE fabrics and 3175 numbers of HDPE woven sacks with reference to the entries in the RG 1 register. Further they found from the files a statement submitted by the appellants to the Bank of India main Branch, Hyderabad which indicated stock and production of 11,68,120 Mtrs of HDPE fabrics valued at Rs. 7,92,844 and 9,22,8 (sic) Rs. 17,24,250. It was found that the appellants had not made entries of these in the statutory records. Therefore it was concluded by the investigating officers after recording statement from the Deputy Chief Manager of Bank of India, Main Branch Shri G.R. Rao, that the ap....
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....Kannan, learned DR for the Revenue. 3. Shri Sasidharan, learned Counsel strenously arguing the matter pointed out that the department cannot solely rely upon the statement of production figures submitted to the Bank for seeking higher financial limit to confirm the alleged clandestine removal of the goods. He submits that it is settled law that the department has to produce corroborate evidence with regard to purchase of inputs, manufacturing capacity, arrangements of funds-employment of skilled and unskilled labourers and sale of goods to various dealers. He cited a catena of judgments on clandestine production and removal of goods where demand confirmed on seizure of private records, showing entries of production has not been accepted ....
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....to confirmation of duty solely on the basis of Bank statement, the learned Counsel relied upon the following judgments : (a)Punjab Oil & Silicate Mills v. CCE as reported in 1993 (65) E.L.T. 268 (a)Rishab Refractories Pvt Ltd. v. CCE as reported in 1996 (87) E.L.T. 93. Wherein certain observations made by the Collector on the ethics and morality to seek such higher financial limit has not been accepted as observed by the Madras High Court in the case of State of Tamil Nadu v. India Craft Industries as reported in 1970 (25) STC cases page 466 wherein it has been held that merely because the assessee conducted himself in a manner which was not conducive to ethics, taxing authority, could not invoke the provisions for re-assessment an....
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....ted by the Deputy General Manager. It is his contention that documentary evidence has more value than the oral evidence and the evidence found was documentary, in nature with regard to the figures. He submits that the statement cannot be brushed aside and it has to be concluded as held by the Collector in the impugned order that there was manufacture and removal of the goods without payment of duty. Therefore, confirmation of duty and imposition of penalty are justified. He seeks for favourable order to the Revenue. 7.On careful consideration of the submissions made and after detailed perusal of the order, we notice that there is lot of force in the submissions of the learned Counsels for the appellants. We have perused the entire order ....
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....held in a number of cases. The best evidence that could be relied upon by the Revenue is the consumption of power which is required for the manufacture of goods and which exercise has not been done. 8.With regard to the duty confirmation solely on the statement of Bank the issue is covered by the judgments cited by the learned Counsel for the appellants as in the case of Ram Gelkem Industries Pvt. Ltd. v. CCE as reported in 1997 (89) E.L.T. 178, in the case of DS Screen Pvt. Ltd. as reported in 1990 (50) E.L.T. 475 wherein the Bench observed with regard to raising the loan by hypothecating/pledging the goods in Para 22 as herein below :- "It is a matter of common knowledge that the goods are pledged/hypothe-cated to the bank for the p....