2022 (1) TMI 258 - AT - Central Excise

Clandestine removal - MS Ingots - demand confirmed merely on the basis of assumption and presumptions - no corroboration to the statement - demand has been confirmed based upon the documents/ ledger maintained by the third party - authenticated and reliable evidences or not - Application for settlement under Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - discharge certificate has not been issued in their favour for want of requisite payments to be made prior to issue of discharge certificate - HELD THAT - The Department conducted investigation in this case with the search in the premises of M/s. Monu Steels. The appellant, Shri S K Pansari, proprietor of said propriety concern who apparently and admittedly was working as commission agent between the sellers and buyers of iron and steel products and used to get commission from either the seller or buyer or from both of them depending upon the finalisation of the deal and the nature of goods - But it is observed that the documents and statement based where upon were the demands against others including other manufacturers or raw material providers were of M/s. Monu Steel and Shri S K Pansari, the present appellant. Those orders are passed based upon the fact that the demand cannot be confirmed based upon such a record which was not recovered from the concerned assessee but from the possession or premises of third party. The demand has been confirmed based upon certain entries in the private ledger book of M/s. Monu Steels itself where Shri S K Pansari, Appellant himself is the proprietor. The premises of M/s. Monu Steel and of Shri S K Pansari were searched. The incriminating documents were got recovered from the appellant s own premises. Physical inspection of furnance of 4000 MT installed in appellant s premises when got compared with the electricity consumption record and the production record of the appellant it correctly led the adjudicating authority to conclude the suppression of production of M S Ingots by the Appellant and clandestinely removing those ingots without proper assessment and payment of duty. Not only this statement of Shri S K Pansari has sufficient admission for the alleged clandestine removal of goods without payment of excise duty. The statement being given to Customs Officer is very much admissible in evidence. As per section 52 of Indian Evidence Act, Admissions need no further proof unless retracted. As already observed above, there is no retraction on part of the appellant. Documents recovered from the premises of appellant rather corroborate the said admission. I am therefore, of the opinion that demand has rightly been confirmed against the appellant - Appeal dismissed.

Summary

Issues:
1. Allegations of clandestine clearance of MS Ingots without duty payment.
2. Adjudication based on recovered documents and statements.
3. Challenge of order based on lack of evidence and presumption.
4. Applicability of extended period of limitation.
5. Admissibility of statements as evidence.
6. Confirmation of demand based on admission and evidence.
7. Benefit of doubt to other parties not applicable due to direct evidence.

Analysis:
1. The appeals involved allegations of clandestine clearance of MS Ingots without duty payment, arising from a common search operation. The appellants, engaged in manufacturing metal steel ingots, faced show cause notices proposing duty demand and penalties based on incriminating documents and statements.

2. The adjudication was primarily based on the recovered documents and statements, including those of the proprietor of a commission agent involved in the transactions. The Department observed intentional clandestine removal of goods without duty payment, leading to the issuance of demand notices and subsequent confirmation of duty liability.

3. The appellants challenged the order, claiming lack of evidence and presumption in confirming the demand. They argued that the demand was unsustainable, and penalties should not be imposed without concrete proof. The appellants also cited legal precedents to support their case.

4. The issue of the extended period of limitation was raised, contending that the consumption of electricity, a crucial factor in the case, was always known and easily verifiable by the authorities. Non-submission of certain details was argued not to amount to suppression of facts, citing relevant legal decisions.

5. The admissibility of statements as evidence was a crucial point of contention. The Department argued that statements before revenue officers were admissible and sufficient to establish intentional clandestine removal. The defense emphasized the importance of Shri S K Pansari's statement and its evidentiary value.

6. The confirmation of demand was upheld based on the admission and evidence presented. The tribunal found no infirmity in the order, considering the direct evidence against the appellants and the lack of retraction from the statements made. The confirmation of demand was deemed appropriate, given the circumstances and evidence on record.

7. The tribunal differentiated the present appellant from others who benefited from the lack of direct evidence against them. Due to direct evidence and admissions against the appellant, the benefit of doubt extended to others was not applicable. The confirmation of demand against the appellant was upheld based on the direct evidence and admission presented.

This comprehensive analysis outlines the key issues, arguments, and the tribunal's decision in the legal judgment concerning the allegations of clandestine clearance of MS Ingots without duty payment.