2008 (4) TMI 96 - AT - Central Excise

Respondent, job-worker - Allegation of clandestine removal on respondent on basis of statement of proprietor firms - statement of proprietor of that firm undisputedly was recorded behind the back of any representative of respondent - adjudicating authority denied cross examination of relied person no conclusive evidence on record, to prove clandestine removal revenue appeal dismissed there is no error in the order of the Commissioner (Appeals)

Summary

Issues:
1. Clandestine removal of goods.
2. Duty demand confirmation and penalties imposition.
3. Reliance on statements for adjudication.
4. Determination of duty liability.
5. Job worker claim verification.

Analysis:

1. The case involved allegations of clandestine removal of corduroy cloth, with M/s. Luxmi Processors accused of such removal and M/s. R.K. Woollen Mills accused of abetting the same. The search conducted at the business premises led to the recovery of delivery challans and subsequent legal actions against the parties involved.

2. The Assistant Commissioner of Central Excise confirmed a duty demand against M/s. Luxmi Processors and imposed penalties under various provisions of the Central Excise Act. Additionally, a penalty was imposed on M/s. R.K. Woollen Mills for abetting the clandestine removal. However, on appeal, the Commissioner (Appeals) set aside the adjudication order, leading to the Revenue appealing against this decision.

3. The Tribunal noted the reliance placed on the statement of the proprietor, Khajinder Singh, which was inculpatory in nature. However, the Tribunal found issues with the statement as it was recorded without allowing cross-examination and lacked supporting evidence to connect the goods' receipt from M/s. Luxmi Processors. The Tribunal highlighted the lack of reliability in the statements recorded during the proceedings.

4. The respondents argued that duty liability should have been determined based on square meters rather than length. M/s. Luxmi Processors claimed to be a job worker, and it was contested whether the goods in question were received from them. The Tribunal found no conclusive evidence in the record to determine the exact source of the goods, supporting the Commissioner (Appeals) decision not to interfere.

5. Considering the lack of concrete evidence connecting the goods' source to M/s. Luxmi Processors and the discrepancies in the recorded statements, the Tribunal dismissed the appeal, affirming the Commissioner (Appeals) decision. The judgment emphasized the importance of reliable evidence and proper procedures in adjudication processes.

This detailed analysis of the judgment provides a comprehensive understanding of the issues raised, the arguments presented, and the Tribunal's decision based on the legal principles and evidence presented during the proceedings.