TaxTMI 
TaxTMI 
2005 (1) TMI 251
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....aterial involving duty Rs. 91,119/-; that after recording the statements of Directors and other employees of the Appellant Company, a show cause notice dated 8-3-1999 was issued for demanding Central Excise duty Rs. 55,37,403/- on the goods cleared by them clandestinely, for confiscating of seized finished goods found in excess, for confiscating finished goods valued at Rs. 19,64,750/- found lying in an outside godown and for demanding duty Rs. 2,94,712/-, for demanding duty of Rs. 91,119/- on shortage of inputs as Modvat credit had been taken by them on those inputs, and for imposing penalties on all the Appellants; that the Commissioner passed the Adjudication Order dated 24-5-2000 confirming the demand of duty and imposing penalty which was remanded by the Tribunal vide Final Order Nos. A/855-57/2000 NB (DB), dated 28-9-2002 as personal hearing was not afforded to them; that the Commissioner, after hearing them, has passed the present impugned Order. 3.1 The learned Advocate submitted that the goods found in outside godowns were purchased from markets and the invoices were produced before the Department; that the goods were fully accounted for in the books of accounts and pay....
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....aders, 1997 (89) E.L.T. 11 (S.C.) = 2002 (79) E.C.C. 469 (S.C.) wherein the Supreme Court has upheld the Tribunal's decision in not placing reliance on the photo copies of the documents. 4.2 He, further, mentioned that the Department had verified from the consignees that no goods had been received by them in relation to these 143 invoices and statements had been taken from all the consignees which had been suppressed by the Department from the Appellants; that they had specifically asked the Commissioner to make available copies of the verification reports as well as statements of the consignees which had been rejected without any justification. He also contended that the originals of these invoices had not been shown to the makers of statements; that the original invoices had also not been shown to the Appellants even at the time of personal hearing nor the Commissioner appears to have himself seen the original invoices; that it is a settled law that a mere photocopy of a document does not constitute valid piece of evidence and unless the originals are produced, there cannot be any demand against the Appellants; that the failure of the Revenue to disclose the names of perso....
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....tural justice .... Any material to be used against the party has to be put to the aggrieved persons and the aggrieved persons and the aggrieved persons should also have the freedom to cross-examine the witnesses who have given their expert opinion." 5.1 Regarding demands of duty of Rs. 52,500/- and Rs. 63,253/- in respect of goods clandestinely removed after having been sent for weighment, the learned Advocate mentioned that there is no evidence as to how this charge is sustainable as there is no material to show as to where the goods were sent; that the statements of Rajbir and Ishwar, drivers of the Appellants, without giving an opportunity of cross-examining them cannot be relied upon; that it is also impossible even to imagine that the quantity of 625 MT in one truck and 1400 MT in the second truck could even be loaded or transported. 5.2 Regarding demand of duty of Rs. 36,888/-, he mentioned that the pipes belonging to M/s. Swastik Trading Co. were received for job work which is evident from Challan No. 01 received from Swastik Trading Co.; that they were to do job of 'end facing, only on which no duty liability is attracted; that the Department has conducted verific....
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....r unless the entries are corroborated by various other pieces of evidences inasmuch as that the Revenue has to show that appellants have purchased the inputs from markets and utilised the same and that the same has been sold to particular persons through invoices or otherwise and the money has flowed back as capital." The Tribunal has also held that non-examination of the Accountant who maintained the seized diary "has rendered the document inadmissible in evidence." (ii) M.M. Dyeing & Finishing v. C.C.E., Chandigarh, 2002 (139) E.L.T. 143 (T). The Tribunal did not uphold the charge of clandestine removal based upon entries in worker/dyeing master's diary and register in absence of corroborative evidence as to receipt of extra/excess raw-material, statements of persons who supplied raw-material, etc. (iii) Poly Printers v. C.C.E., Delhi-I, 2002 (139) E.L.T. 295 (T) Tribunal has held that mere recovery of certain invoices addressed to the fictitious firms, recovered from the residence of Appellants is not sufficient to establish the charge of clandestine removal in absence of "statement of any buyer to establish the clandestine sales of the fi....
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....been placed on the decision in the case of State of Maharashtra v. Natwarlal Damodardas Soni, 1983 (13) E.L.T. 1620 (S.C.) wherein the Supreme Court has held that assuming arguendo, that the search was illegal, then also, it will not affect the validity of the seizure and further investigation by the Customs Authorities or the validity of the trial which followed......" 6.2 The learned S.D.R., further, contended that all the statements were in the hand-writing of the persons making the statements; that the retraction/affidavits were never filed with the Investigating Officers of the Department or the Adjudicating Authority as the affidavits are stated to have been filed before the Executive Magistrate and were furnished to the Department only alongwith reply to the show cause notice; that even in the first round of adjudication the Appellants had not mentioned anything about the statement being retracted; that as such these retractions are of no significance. He referred to the statement dated 18-12-1998 of Ishwar Singh, driver who had deposed that he used to go to Punjab and Delhi to deliver iron pipes to the address told by the employer and in respect of the photo copy of invo....
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....naccounting of finished goods in statutory records and shortage of inputs, the learned S.D.R. submitted that the stock taking was conducted in the presence of witnesses, Lajpat Verma, Satyavir Sharma, Accounts Officer and J.B. Garg; that Lajpat Verma had admitted the non-accountal of the finished goods and shortage of the inputs in his statement dated 9-9-1998; that the weight of the goods was recorded upto 3 decimals which shows the correctness of weighment. Regarding other charges and confirmation of demands of duty, the learned S.D.R. reiterated the findings as contained in the impugned Order. 8. In reply, the learned Advocate emphasised the fact that not a single person had been produced by the Department for cross-examination; that the Supreme Court has set aside the Order of the High Court in Arya Abhushan Bhandar v. U.O.I., 2002 (143) E.L.T. 25 (S.C.) for not producing of witnesses to Panchnama for cross-examination discarding the plea that no prejudice has been caused to the appellants by reason of the non-production of the Panchas. In this regard, reliance has also been placed on Lakshman Exports Ltd v. C.C.E., 2002 (143) E.L.T. 21 (S.C.). He also said that the actual r....
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....ds were delivered by him. We also observe that both these drivers have been put quesitons in respect of only a very, few GRs which do not cover all the 143 invoices. No other statement of any transporter has been referred to by the Revenue to prove the despatch and delivery of the goods. The learned Advocate has also submitted that though the Appellants had sought cross-examination of these two drivers, the same has not been done and as such these statements cannot be relied upon. Thus, the statements of both the drivers have remained uncorroborated and also suffer from the short-coming of not being cross-examined by the Appellants. 10. The learned Advocate has also vehementally contended that the Revenue has not adduced any evidence regarding purchase of raw-materials required to manufacture the alleged quantity of pipes nor any material has been produced regarding consumption of electricity. We find substantial force in these submissions of the learned Advocate as there is nothing on record to show whom the various raw-materials were purchased from. It has been held by the Tribunal in the case of Kashmir Vanaspati Pvt. Ltd. v. C.C.E., 1989 (39) E.L.T. 655 (T) that charge of cl....
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....not accounted for in the statutory record by the appellants and of the buyers to whom the final product i.e. copper wire rods were allegedly supplied by them without the payment of duty, during the period in question, were recorded. No. evidence regarding consumption of electricity during the period in question more than what it was consumed in the normal course by the appellants was collected during the investigation." The Tribunal has held that no capital out of the statement could be taken as the same had remained uncorroborated from any other reliable and concrete substantive evidence. In the present matters also, the statements and the invoices have remained uncorroborated by any independent unimpeachable evidence, such as purchase of raw-materials/consumption of electricity/purchase of goods by buyers, etc. In view of these facts and circumstances, the Revenue has not succeeded in proving the allegation of clandestine manufacture and clearance of pipes by the appellants on the basis of 143 invoices in question. We, therefore, set aside the demand of duty on this count. 11. Regarding other demands of duty confirmed in the impugned order, our findings are as under : ....