2016 (5) TMI 1072 - AT - Central Excise

Un-sustainability of the charge of clandestine removal of excisable goods against the respondent - Held that - While statements given before the excise officers are admissible evidence, the contents of such statements should clearly bring out the nature of offence with specific details which can be cross verified also. In the present case specific details and such cross verification and corroboration is lacking. Mere payment of some amount during investigation by itself cannot be held as admission of duty evasion which has to be decided based on material evidence collected during investigation. Perusal of the detailed opinion given by the hand writing expert brings out the fact that detailed reasoning has been given by the expert and the opinion cannot be brushed aside lightly.

Summary

Issues:
Appeal against dropping duty demand based on clandestine clearance, validity of evidence including statements and documents, reliance on hand writing expert opinion, charge of clandestine removal, authenticity of recovered invoices, admissibility of statements as evidence, voluntary deposit during investigation.

Analysis:
The case involved an appeal by the Revenue against the dropping of duty demand on the respondent, engaged in manufacturing plastic parts for motor vehicles. The appeal was based on the alleged clandestine clearance of excisable goods by the respondent, supported by search operations, recovered documents, and statements. The original order confirmed duty demand, imposed penalties on the appellant and individuals, which was set aside by the Commissioner (Appeals), leading to the Revenue's appeal.

The Revenue argued that the impugned order erred in dropping the duty demand, emphasizing the evidence of clandestine clearance and questioning the validity of statements and hand writing expert opinion. They relied on Section 14 statements, parallel invoices, and fictitious challans to establish the modus operandi of the appellant for clandestine removal of goods, supported by case laws.

In response, the respondent's counsel contested the case being solely based on documents recovered from an ex-employee, highlighting business rivalry and lack of concrete evidence linking the alleged parallel invoices to the appellant. They raised doubts on the authenticity of signatures, presented affidavits from buyers denying receipt of goods under such invoices, and questioned the reliance on third-party evidence.

After considering both sides and examining the evidences, the Tribunal focused on the sustainability of the charge of clandestine removal against the respondent. The impugned order's findings on the unreliability of parallel invoices, lack of corroboration, and absence of proper documentation for recovery were crucial in the decision. The Tribunal upheld the impugned order, emphasizing the need for specific details in statements, corroboration, and material evidence for duty evasion, dismissing the Revenue's appeal based on the analysis and findings presented.

In conclusion, the Tribunal found the grounds raised in the appeal unsustainable, affirming the impugned order's decision. The admissibility of statements, lack of concrete evidence, and detailed analysis of expert opinions played significant roles in the judgment, leading to the dismissal of the appeal.