TaxTMI 
TaxTMI 
2004 (7) TMI 217
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....96. Shri K. Sarover, Chief General Manager of the appellant Company identified the bearings and the machinery on which they had been mounted. He gave details of bearings mounted on the main equipment and stated that the bearings covered by the above said two bonds had been utilized in implementation of project before they were debonded from the CWC warehouse. The warehoused goods were removed clandestinely and the bills of entry were subsequently filed to regularize the clearances after removing the goods clandestinely. Accordingly show cause notice was issued on 21-5-98 to the appellants and their officers. The case was adjudicated by Commissioner of Customs Bangalore under his Order No. 7/99-Cus., dated 5/7-5-99 confiscating the goods valued at Rs 15,88,375/- but allowed these goods to be redeemed on a fine of Rs. 12 lakhs. He also demanded duty of Rs. 43,18,783/- along with interest of Rs. 14,12,988/- and imposed a penalty of Rs. 60 lakhs on the appellants. This Order of the Commissioner was challenged before the Tribunal and the Tribunal in its Order No. 2250/99, dated 31-8-99 remanded the case for readjudication. After considering the appellants arguments and the observations ....
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....ported by the appellants which were required to be mounted on various machineries. These bearings were bonded under bond No. 10/95-96, dated 7-3-96 and 2/96-97, dated 19-4-96. He pleaded that these bearings were removed from the warehouse under cover of 2 ex-bond bill of entries both dated 22-11-96. The said ex-bond bill of entries were duly counter signed by custom authorities and 'pass out of customs charge' was given. He pleaded that the Hon'ble High Court had directed the Commissioner to decide the case as per the direction given by the Tribunal in para 6 of the CEGAT order dated 31-8-99. He stated that the order of the Commissioner is not legal and correct on the following grounds: (i) Commissioner has gone contrary to the directions of the High Court as well as Tribunal. (ii) The Commissioner has analysed the statement of Shri Sarovar to prove that it substantiates the allegation of clandestine removal of bearings. This is contrary to the direction of CEGAT dated 31-8-99 wherein in no uncertain terms the CEGAT has held that statements of Mr. Sarovar does not in any way substantiate....
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....68 provides procedure which an importer would follow while clearing the warehoused goods for home consumption. Without the permission of customs authorities goods can not be cleared from warehouse. (vii) Demand under Section 72 is without jurisdiction as has been dealt with in para 40 of the Commissioner's order. Section 72(i)(a) can be invoked only where any warehoused goods can be removed from a warehouse in contravention of Section 71 and Section 71 stipulates that no warehoused goods shall be taken out of warehouse except on clearance for home consumption or re-exportation or for removal to another warehouse or as provided by the Act. In this case goods have been cleared by filing ex-bond bill of entry. (viii) Reliance on Khaja's evidence (paras 26 and 44) is in violation of principles of natural justice. Opportunity to cross-examine Shri Sarovar should have been provided but it was refused on the ground that his statement was recorded under Section 108 of the Customs Act. (ix) The documents have precedence over the statements. Even if Shri Sarovar's statement is inculpatory....
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....hich was only surrounded by barbed wires and was illuminated with halogen lamps during the night time. There was sufficient place around the warehouse where the trucks and cranes can be moved and goods could have been taken out. The officers of the appellants had clearly mentioned that the goods were removed from the warehouse in the night when neither Customs officer was there nor the warehouse keeper of the CWC was there. In order to conceal the clearance of the packages of machines they were replaced by the original packages, by filling these up with old junk machines, scrap and stones which were available in the appellants site for erection of the plant and these packages were replaced again in the warehouse so that neither the warehouse manager of CWC nor the customs officer could detect any movement of the packages from the open warehouse. Accordingly the case was booked for which separate proceedings were done. On further investigation, the officers further detected irregularities in clearance of the bearings which were used in the plant which was inaugurated by the Chief Minister on 22-8-1996. On 12-11-1997 after detecting the irregularities, the officers visited the appell....
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.... Manager, Central Warehousing Corporation already deposed under Section 108 of Customs Act that officers of DRI visited his office on 23-8-1997 along with two independent witnesses and was asked to produce the warehouse register and copies of into-bond and ex-bond bills of entry. When asked to explain as to why the goods bonded in the warehouse were found missing he stated that the goods as received were properly warehoused but the warehouse premises is open yard with wire fencing. He suspected the top management of M/s. JVSL to have taken out the materials missing from the bonded warehouse. Since all the items were machinery and parts thereof which could be used in only by them, theft from warehouse might have taken place after his office hours. He was the only employee of CWC working in that warehouse at Toranagallu. Para 5 of the show notice also mentioned that Shri K. Sarovar Chief General Manager of the appellants in his statement dated 27-8-1997 has stated that the manner in which the packages were removed from CWC yard. In para 9 of the show cause, Shri P.K. Kedia General Manager of JVSL in his statement dated 8-9-1997 has given the entire manner how these warehoused goods w....
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....f ex-bond bill of entry the learned SDR pointed out that this issue has been considered by the Commissioner in para 26 of the impugned order. 9.He further pleaded that in the remand order it is clearly mentioned that the Commissioner in the de novo proceedings shall take into consideration all the above submissions of the appellants as well as our observations and after further hearing the appellants shall pass detailed speaking order. Now since the Commissioner after hearing the appellants and considering all the points as mentioned in the para 6 has passed the impugned detailed speaking order which is as per the direction of the Tribunal and the High Court. There is no infirmity in the order as has been pointed out by the appellants. All the fallacies pointed out by the appellants in the statement of Shri Sarovar has been duly considered by the Commissioner in para 46 of his order and has given a very detailed and fact finding order based on the evidence on record as indicated in the show cause notice. Therefore his order is correct in law and the same should be upheld. 10.We have carefully considered the submissions made by both the sides. The main issue to be decided is w....
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....t. The said warehouse is being managed by CWC with one officer of the rank of warehouse manager without any supporting staff. The warehouse manager remains present in warehouse during office hours and beyond office hours no staff of CWC remains present to guard the warehouse. The appellants had provided the security to said warehouse since the same is located inside their premises. The show cause notice dated 21-5-1998, issued to the appellants clearly shows in para 3 that Shri P.K. Mathew, Manager, Central Warehousing Corporation and in charge of the warehouse in his statement dated 23-8-1997 has clearly admitted that he is the only employee of CWC working in that warehouse at Toranagallu and he stated that Top Management of M/s. JVSL would have taken out the material missing from the bonded warehouse since all the items were machinery and parts thereof which could be used only by them and theft in the warehouse might have taken place after office hours. In para 5 to Para 9 of the show cause notice, how the goods were removed from the warehouse without knowledge of CWC and Customs is explained in the statements of the various officers of the appellants and which has been taken int....
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....on 30-8-1996; R.M. Approach Table on 25-9-1996, 31-8-1996, 28-9-1996; Delay Table on 25-7-1996. (b) AW 222H 68 Nos. As at (a) above (c) ASW 240 H 10 Nos. R.M. Front Mill Table and RM Back Mill Table (d) AW 218 H 30 Nos. Delay Table on 31-10-1996 (e) AW 212 H 25 Nos. Run out Table on 28-9-1996 and 31-10-1996 (f) A 216 H 25 Nos. As at (e) above Bond No. 2/96 (g) AD 8310 97 Nos. As at (a) above (h) AW 212 H 75 Nos. As at (e) above The above dates are the ones pertaining to placement of basic equipments on foundations for which a contractor has raised bills and copies of which are furnished." Thus Shri Sarovar after verifying the record has stated that certain goods pertaining to bond No. 10/95 and 2/96 have been utilized in implementation of the project before these were debonded from CWC bonded warehouse. He has also given the details of the bearings mounted on the main equipment and dates of placement of basic equipment on foundation. His statement does not show the date on which the bearings were mounted on the main equipment. In para 22 of the Order, the Commi....
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....ubmission of the ex-bond bills of entry." We find on this issue, the Commissioner has given clear finding in para 25 to 25.2 of his order relying on various decisions of the Supreme Court mentioned in the said para that department was not required to prove its case with mathematical precision, but what was required was the establishment of such a degree of probability that a prudent man may on its basis believe in the existence of the facts in issue. We find that the findings of the Commissioner are according to the law as in the case of clandestine removal it is not always possible to establish the exact date of clearance but if the period during which clearance have taken place is established, then it is sufficient to say that the goods have been removed within that period. In the present case, the reports of M/s. TTG Industries as mentioned above read with the statement of Shri Sarovar and Mahazar dated 22-11-1997 clearly shows that the bearings were removed during the period from July to October. Thus on the direction of the Tribunal he has analyzed the evidence and came to the conclusion that bearings in dispute were cleared from the warehouse from July to Oct., 1996. The a....