TaxTMI 
TaxTMI 
TaxTMI 
2025 (2) TMI 1407
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....ise & Service Tax purportedly seized 3 pen drives and 2 computers for the officer premises and printouts from one of the said computers were taken. Similarly a laptop was also seized from the premises of the factory. During the course of investigation, statements were also recorded of Shri Gautam Kumar Jaiswal, Director, Sri Pankaj Dubey, Smt. Shreya Sarkar and other officers and stalls of the Appellant Company under Section 14 of the Act. 2.2 The Revenue relied upon the statements of Shri Pankaj Dubey, wherein he has mentioned that he was looking after the works of liasoning, banking and realization of payments from the parties and has no knowledge about the contents of pen drive and computer data as he does not know how to work on a computer. Ms. Shreya Sarkar and Shri Gautam Kumar Jaiswal can only explain about the nature of the documents. 2.3 The statement of Smt. Shreya Sarkar, Accountant of Appellant Company, was also recorded on 21.03.2017. In her statement, she gave the details of the raw material used in the factory, from where it was purchased and the payments of the same were made full in advance through cheques/ NEFT/ RTGS/ e-payments only. She also stated that th....
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....n Chaudhary left the job due to some problems with the Directors, RG 23 A Part-II could not be maintained after Sl. No. 210. 2.6 The consignees of the Company were summoned and their statements were also recorded on 24.04.2017. Shri Amar Pratap, Proprietor of M/S Aman Aluminum & Glass in his statements accepted that proper search was conducted at his business premise and the seized documents were recovered from there, wherein a ledger was found. He also stated that they have received the goods from Appellant Company and the entries for the same have been made in the ledger. Further, he was asked to tally the entries from the ledger seized from his office and the party ledger contained in the pen drive bearing File No. J.J./57/2/2017 and on doing the same he stated that the entries relating to payments match, he was asked to go through the ledger seized from his office. Certain figures were written, there for which he stated that those were the actual quantity of aluminum sections purchased and received by them and actual payment made by them to the Appellant Company. It was also found that certain pages was torn out from the seized ledger in response to which he stated that it w....
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....igation was done by the Department from them to establish the clandestine manufacture and clearance of goods or excess received of raw materials. 3.3 He further submitted that no evidence has been brought on record of excess consumption of electricity and clandestine manufacture and clearance of goods. He submitted that although the investigation was completed in 2017 and thereafter, after three (3) years again, the statement was recorded and the show-cause notice was issued, which is highly time barred. Therefore, the impugned order is to be set aside. 4. On the other hand, the ld. A.R. for the Revenue, reiterated the findings of the impugned order. 5. Heard both the parties and considered the submissions. 6. We find that to establish the clandestine manufacture and clearance of goods, this Tribunal in the case Arya Fibre Private Limited Vs. Commissioner of Central Excise, Ahmedabad II reported in 2014 (311) ELT 529 (Tri - Ahmedabad) has laid down to establish the clandestine removal of goods, wherein this Tribunal has held as under : "40. After having very carefully considered the law laid down by this Tribunal in the matter of clandestine manufacture and cle....
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.... It is reproduced: "Section 36B- Admissibility of micro films, facsimile copies of documents and computer print outs as documents and as evidence. (1) Notwithstanding anything contained in any other law for the time being in force,- (a) a microfilm of a document or the reproduction of the image or images embodied in such microfilm (whether enlarged or not); or (b) a facsimile copy of a documents; or (c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a "computer printout"). (2) The conditions referred to in sub-section (1) in respect of a computer printout shall be the following namely :- the computer printout containing the statement was produced by the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period by the person having lawful control over the use of the computer, (a) during the said period, there was regularly supplied to the computer in the ordinary course of the said activities, information of the kind contai....
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....b-section it shall be sufficient for a matter to be stated to be to the best of the knowledge and belief of the person stating it. (5) For the purposes of this section,- (a) Information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate form and whether it is so supplied directly or (with or without human intervention) by means of any appropriate equipment; (b) whether in the course of activities carried on by any official, information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities, that information, if duly supplied to that computer, shall be taken to be supplied to it in the course of those activities; (c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment. Explanation - For the purposes of this section,- (a) "computer" means any device that receives, stores and processes data, applying stipulated processes to the information and supplying results....
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...., held that evidence relating to electronic record shall not be admitted in evidence unless the requirement of section 65B of the Evidence Act is fulfilled. The relevant paragraphs of the said judgment are reproduced: "13.Any documentary evidence by way of an electronic record under the Evidence Act, in view of Sections 59 and 65A, can be proved only in accordance with the procedure prescribed under Section 65B. Section 65B deals with the admissibility of the electronic record. The purpose of these provisions is to sanctify secondary evidence in electronic form, generated by a computer. It may be noted that the Section starts with a non obstante clause. Thus, notwithstanding anything contained in the Evidence Act, any information contained in an electronic record which is printed on a paper, stored, recorded or copied in optical or magnetic media produced by a computer shall be deemed to be a document only if the conditions mentioned under sub- section (2) are satisfied, without further proof or production of the original. The very admissibility of such a document, i.e., electronic record which is called as computer output, depends on the satisfaction of the four condition....
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....taining to electronic record sought to be used as evidence. Electronic records being more susceptible to tampering, alteration, transposition, excision, etc. without such safeguards, the whole trial based on proof of electronic records can lead to travesty of justice. 16. Only if the electronic record is duly produced in terms of Section 65B of the Evidence Act, the question would arise as to the genuineness thereof and in that situation, resort can be made to Section 45A - opinion of examiner of electronic evidence. 17. The Evidence Act does not contemplate or permit the proof of an electronic record by oral evidence if requirements under Section 65B of the Evidence Act are not complied with, as the law now stands in India. XXXXXXXXXXX 22. xxxxxxxxxxx. Section 63 and 65 have no application in the case of secondary evidence by way of electronic record; the same is wholly governed by Section 65A and 65B. to that extent, the statement of law on admissibility of secondary evidence pertaining to electronic record, as stated by this court in Navjot Sandhu case (supra), does not laydown the correct legal position. It requires to be overruled and we do ....
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....f documents may be proved either by primary or by secondary evidence. Section 62 of the Evidence Act defines primary evidence as meaning the document itself produced for the inspection of the court. Section 63 of the Evidence Act speaks of the kind or types of secondary evidence by which documents may be proved. Section 64 of the Evidence Act then enacts that documents must be proved by primary evidence except in the circumstances hereinafter mentioned. Section 65 of the Evidence Act is important, and states that secondary evidence may be given of the existence, condition or contents of a document in the following cases " 19. Section 65 differentiates between existence, condition and contents of a document. Whereas "existence" goes to "admissibility" of a document, "contents" of a document are to be proved after a document becomes admissible in evidence. Section 65A speaks of "contents" of admissibility of electronic records which deals with-existence land-contents of electronic records being proved once admissible into evidence. With these prefatory observations let us have a closer look at Sections 65A and 65B. 20. It will first be noticed that the subject matte....
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....e sub-section begins with a non obstante clause, and then goes on to mention information contained in an electronic record produced by a computer, which is, by a deeming fiction, then made a "document". This deeming fiction only takes effect if the further conditions mentioned in the Section are satisfied in relation to both the information and the computer in question; and if such conditions are met, the "document" shall then be admissible in any proceedings. The words " ... without further proof or production of the original ... " make it clear that once the deeming fiction is given effect by the fulfilment of the conditions mentioned in the Section, the "deemed document" now becomes admissible in evidence without further proof or production of the original as evidence of any contents of the original, or of any fact stated therein of which direct evidence would be admissible. 31. The non-obstante clause in sub-section (1) makes it clear that when it comes to information contained in an electronic record, admissibility and proof thereof must follow the drill of Section 65B, which is a special provision in this behalf - Sections 62 to 65 being irrelevant for this purpose. ....
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....n referred to above is that the required certificate under Section 65B (4) is unnecessary if the original document itself is produced. This can be done by the owner of a laptop computer, computer tablet or even a mobile phone, by stepping into the witness box and proving that the concerned device, on which the original information is first stored, is owned and/or operated by him. In cases where the "computer" happens to be a part of a "computer system" or "computer network" and it becomes impossible to physically bring such system or network to the Court, then the only means of providing information contained in such electronic record can be in accordance with Section 65B(1), together with the requisite certificate under Section 65B(4). The last sentence in Anvar P.V. (supra) which reads as " .. if an electronic record as such is used primary as evidence under Section 62 of the Evidence Act ... "is thus clarified; it is to be read without the words "under Section 62 of the Evidence Act, ... " With this clarification, the law stated in paragraph 24 of Anvar P.V. (supra) does not need to revisited. (c) The general directions issued in paragraph 62 (supra) shall hereafter be ....
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....ctronic record by oral evidence if the requirements section 65B of the Evidence Act is not complied with; c. An electronic record by way of secondary evidence shall not be admitted in evidence unless the the requirements of section 65B of the Evidence Act has satisfied; and d. This would not apply in a case where the appellant adduces primary evidence by making available in evidence the electronic records. (iii) A Bench of the Tribunal in Agarvanshi Aluminium Ltd. vs. Commissioner of Customs (I), Nhava Sheva [2014 (299) ELT 83 (Tri .- Mum)] where the issue was with respect to section 36B of the Central Excise Act, also observed: "12. ...... it is clear that for admissibility of computer printout there are certain conditions have been imposed in the said section. Admittedly condition 4C of the said section has not been complied with and in the case of Premier Instruments & Controls (supra) this Tribunal relied on the case of International Computer Ribbon Corporation - 2004 (165) E.L.T. 186 (Tri .- Chennai) wherein this Tribunal has held that "computer printout were relied on by the Adjudicating Authority for recording a finding of clandestine manu....
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....Appeal No. 11963 of 2016 decided on 15.01.2024], the Tribunal observed: "19. Ongoing through the aforesaid provisions, we find that Section 36B(2) provides the conditions in respect of computer printouts. In the present matter the computer was not shown to have been used regularly to store or process information for the purposes of any activities regularly carried on by the appellants. It was also not shown that information of the kind contained in the computer printout was regularly supplied by the appellant to the computer in the ordinary course of activities. Again, it was not shown that, during the relevant period, the computer was operating in the above manner properly. The above provision also casts a burden on that party, who wants to rely on the computer printout, to show that the information contained in the printout had been supplied to the computer in the ordinary course of business of the company. We find that none of these conditions was satisfied by the Revenue in this case. In the present case, the data was not stored in the computer but the officers had taken the printout from the Hard Disk drive by connecting to the computer. The officers had not obtained ....
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.... is installed in the kitchen of the said premises and these monitors are working as extension of the computer in the kitchen and connected through cable"; (iv) On searching the kitchen, the officers recovered "Computer (CPU, Monitor, Keyboard and Mouse) which was switched on and CPU was found without cover and without having any hard disc"; (v) The officers conducted a thorough search of the entire residential premises and found "one of the hard disc hidden in a corner lying near the dog house"; (vi) The officers also found two hard discs from the cupboard of the kitchen; (vii) The officers asked Vaibhav Goel to connect the hard disc found in the corner near dog house with the CPU installed in the kitchen; (viii) On the direction of Vaibhav Goel, Mohit Vaish started the CPU after connecting the said hard disc; (ix) On being asked by the officers to take the printouts of data captured in the software, Vaibhav Goel informed that being a MS Dos based software, "printout cannot be taken without configuring printer Canon LBP 2900B (available in the residence) with site key and license key" (x) On being asked how these keys c....
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....or were also installed without a CPU. The officers were informed that one desktop computer connected with the CPU is installed in the kitchen and these monitors are working as extension of the computer in the kitchen and were connected through a cable. Ultimately the officers recovered CPU, Monitor, Keyboard and Mouse in the room, but the CPU was found without cover and hard disk. The Panchnama does not record that Vaibhav Goel was seen removing the hard disk from the CPU and indeed it would not have been possible for Vaibhav Goel to remove this hard disk from the CPU in the presence of all the officers and throw it away. There is nothing on the record to link the hard disk to the CPU, nor is there anything to link that the hard disc and the pen drive stored information contained in the computer. 30. A hard disk is a rigid magnetic disk that stores data. A pen drive is a data storage device that includes flash memory with an integrated USB interface. 31. The printouts, which are the sole basis for holding that the appellant had indulged in clandestine removal, were taken both on 04.07.2013 and on 15.07.2013 by placing the recovered hard disc and pen drive in the C....
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....ral Excise Act is followed. For the sake of ready reference the said Section is reproduced below: "9D. Relevancy of statements under certain circumstances. - (1) A statement made and signed by a person before any Central Excise Officer of a gazetted rank during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of 15 Appeal No. E/76044 & 76046/2023-DB 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 interests of justice. (2) The provision of sub-section (1) shall, so far as may be, apply in relation to any proceeding under ....