TaxTMI 
TaxTMI 
2026 (3) TMI 430
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....st under section 11AA of the Act and imposed an equal amount as penalty under section 11AC of the Act and imposed penalty of Rs. 11,00,000/-under Rule 26 of the Central Excise Rules, 2002 [Rules] on Shri Goel. 2. Excise Appeal No. 50318 of 2017 has been filed by JD Ispat to assail the confirmation of duty with interest and penalty. Excise Appeal No. 50040 of 2017 has been filed by Shri Goel to assail the penalty imposed on him. 3. JD Ispat manufactures mild steel (MS) ingots and billets and was registered with the central excise department. Acting on intelligence, the officers of DGCEI searched the premises of JD Ispat and also the business premises of its broker M/s. Bajrang Enterprises on 20 & 21 March 2013 and recovered several documents which led it to believe that JD Ispat had clandestinely manufactured and removed MS ingots and billets without paying central excise duty as follows: S. No. Details Quantity (MT) Duty (Rs.) 1 Shortage of goods found during stock taking (M S ingots) 601.680 22,68,214 2 Clandestine removal of billets based on the information contained in the slip pad recovered from the factory (S. No. 18 of Annexure-1 of the Pan....
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....ions and presumptions. (vii) The SCN states Shri Goel admitted to the shortage but Shri Goel never admitted to removing the goods without payment of duty. (viii) The Central Excise invoices mentioned in paragraph 6.1 of the SCN have not been found false. Assuming that JD Ispat had cleared MS Ingots and MS Billets as alleged in paragraph 6.16 of the SCN, the officer ought to have found the source and supply of raw materials required to manufacture MS Billets supplied to M/s. MK Re-rolling Pvt. Since the officers could not find any unaccounted for raw materials, the allegation in paragraph 6.16 of the SCN is not sustainable. The name of the typist is not mentioned on the statements enclosed as RUD 6, RUD 8 and RUD 11 and therefore, they are not admissible. (ix) If the statement of billets shown in paragraph 6.1 of the SCN is treated as having been cleared on payment of duty, the demand of duty of RS. 22,68,214/- on 601.680 MT of MS ingots found short is incorrect. (x) The statutory records maintained by the appellant were incorrectly disbelieved in the impugned order. (xi) The slip pad is a private document and it does mention the date, mo....
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.... the Revenue 6. Learned authorized representative for the Revenue made the following submissions: (i) The demand of duty was confirmed on three counts- (a) shortage of the MS ingots found during stock taking of JD Ispat; (b) Clandestine removal based on the slip pad maintained by the JD Ispat showing the total clearances the clearances on which duty was actually paid; and (c) clandestine removal of billets based on the information recovered from the broker of JD Ispat M/s. Bajrang Enterprises. (ii) The stock of goods in the factory of JD Ispat was verified and 601.680 MT of MS Ingots was found short. The stock taking was undertaken under a Panchnama in the presence of the representatives of JD Ispat including Shri Goel. They did not dispute the method employed for taking stock and Shri Goel, in fact, had, in his statement, recorded satisfaction of the manner in which stock was taken. (iii) The method of taking stock was never challenged by the appellants and the statements were also not retracted. (iv) Admitted facts need not be proved. (v) The slip pad recovered from the premises of JD Ispat (S.No. 18 of An....
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....g Enterprises giving details of the goods sold and the invoices for the corresponding dates and the difference between the two. Goods found short on stock taking 8. The stock taking was conducted on 20.3.2013 and 21.3.2013 and a Panchnama was drawn. It is undisputed that during stock taking the representatives of JD Ispat were present. Shri Goel had expressed his satisfaction at the method of taking stock. Learned counsel has now, before us, raised doubts about the method of taking stock adopted. His first objection is that the Panchnama was drawn and typed in English while the panchas had signed in Hindi, which, according to the learned counsel is proof that the panchas did not know English. We find no reason to come to such a conclusion. A signature is a person's own choice and it is not uncommon to find even senior officers signing in Hindi even official documents in English. The argument of the learned counsel that simply because someone signed in Hindi, it means that the person does not understand or know English has no basis. 9. The second submission of the learned counsel is that the billets were of standard sizes of 100x100 and 125x125 and for stock taking the aver....
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....es of JD Ispat. There is also no dispute that the slip pad contained details of goods cleared on four dates by JD Ispat and that the invoices were issued on the four days for much less quantities of MS billets. The submission on behalf of the appellants is that the slip pad was a private document and while it does mention the date, month and goods cleared but it does not mention the year and therefore the demand cannot be sustained on this basis. It is also the submission of the appellants that the statutory records showing clearances were wrongly disbelieved. It is further the submission of the appellant that Shri Ravi Soni, the purchase supervisor has, in his statement, said that date wise consolidated loading figures were recorded by the loading supervisor but the statement of the loading supervisor was not recorded. It is further submission of the appellants that the slip pad also mentions the vehicle numbers in which the goods were cleared but the officers did not trace the vehicles. 15. We find that the case of the department is that goods were clandestinely removed, i.e., removed without issuing invoices and without recording them in the statutory returns on the four date....
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....d appeared. Thus, the appellant did not avail the opportunity to cross examine Shri Ralhan. 19. However, the Commissioner did not admit the statement of Shri Ralhan as evidence after following the procedure under section 9D of the Act without which the notebook itself does not carry much weight. The figures in the notebook coupled with its explanation by Shri Ralhan is what proves the case against the appellant. 20. Therefore, the demand on the basis of the notebook recovered from M/s. Bajrang Enterprises cannot be sustained. 21. Learned counsel for the appellants also submitted that he was not given an opportunity to cross examine some officers and transporters. He also submitted that the statements were not put through the process under section 9D of the Act and admitted in evidence. For these reasons, according to the learned counsel, the principles of natural justice were violated. Be that as it may, we have only considered those documents, viz., the Panchnama showing the shortage of the goods in the factory of JD Ispat and the slip pad maintained by it and recovered from its premises which are not disputed even before us. What is admitted need not be proved. 22. Le....