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TMI Blog2008 (12) TMI 423X X X X Extracts X X X X X X X X Extracts X X X X ..... being disposed off by a common order as they arise out of the same impugned order passed by Commissioner, vide which he has confirmed duty of Rs. 1,06,26,936/- against M/s. Sulekhram Steels Pvt. Ltd. along with confirmed interest. In addition, penalty of identical amount stands imposed under Section 11AC of the Act and penalty of Rs. 10 Lakhs stands imposed under Rule 25 of Central Excise Rules, 2002 on the said appellant. Further penalty of Rs. 10 Lakhs stands imposed upon Shri Chhajusingh S. Kanwal, Chairman and Managing Director of M/s. Sulekhram Steels Pvt. Ltd. under Rule 26 of the Central Excise Rules, 2002. In addition, Commissioner (Appeals) vide impugned order has imposed penalty of Rs. 5 Lakh on Shri Shakeelbhai Abdul Rauf Vohra, partner of M/s. A.S. Corporation and penalty of Rs. 3 Lakh on Shri Kirtibhai C. Patel, proprietor of M/s. Avantika Steel Suppliers. In addition, penalties of Rs. 1 lakh each stands paid on the other appellants in terms of provisions of Rule 26 of Central Excise Rules. 2. As per facts on record, M/s. Sulekhram Steels P. Ltd. are engaged in the manufacture of TMT bars. Their factory premises were searched on 21-9-2004 along with the search o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business since last 8 years, that on the basis of his experience he states that TMP & CTD bars are manufactured by automatic mills as well as rolling mills; that cut size and good quality TMT & CTD bars are manufactured by automatic mills whereas both cut size and random TMT & CTD bars are manufactured by rolling mills; that the rates differed by Rs. 500/- to Rs. 800/- per MT both the above products; that while taking orders from customers details i.e. CTD or TMT, quantity, automatic or rolling mill's items and thereafter the rates are quoted; that they do business in maximum TMT/CTD bars of automatic milts, that they had purchased TMT/CTD from mills viz. M/s. Sulekhram Steels Pvt. Ltd., M/s. Sirhind Steel etc. And sell the same to their customers; that the marks are embossed on the bars manufactured by such mills; that apart from the above, they purchase from different Traders and sell the same to their customers; that the quality of the materials set to the customers i.e. either they are of automatic mills or re-rolling mills are not verified; that the automatic mills issue the test certificate on request and the said certificate in original or the photocopy of the said certifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. A.S. Corporation. The outcome of said enquiry was that some of traders were not registered with the Sale Tax Department and some of the traders though originally registered, got their registration cancelled. From the above, Revenue entertained a view that the traders in question were bogus and have not been actually dealt with the sale purchase of goods. 9. As a follow up action, statements of various buyers of M/s. A.S. Corporation was recorded, indicating that the TMT bars being purchased by them were manufactured by M/s. Sulekhram Steels P. Ltd. as ascertained from the mark "SULEKHRAM" embossed on the TMT CTD bars, identifying the name of the manufacturer. They clarified that they used to place orders with M/s. A.S. Corporation for supply of TMT bars. 10. During the course of further investigation, statement of transporters was recorded indicating that they used to load the materials from factory from Sulekhram Steels P. Ltd and deliver the same to the customers as per the instructions. The trip register maintained by these transports were also scrutinized to take support of the fact that goods were loaded at the premises of M/s. Sulekhram Steels P. Ltd. 11.&ems ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s with the same embossing or the goods might have been procured by M/s. A.S. Corporation from the open market stock of the goods manufactured by M/s. Sulekhram Steel P. Ltd. Further arguing on the transporter's statement and the entries maintained by them, our attention was drawn to a chart appearing at Page 166 of the Paper Book. Against most of the trucks used by M/s. A.S. Corporation, as reflected in the invoices raised by them, showing sale of TMT bars to their customers, it is seen that there is no entry in the trip register maintained by the transporter showing that the goods have actually been loaded from the factory premises of M/s. Sulekhram Steel P. Ltd. Commissioner has picked up only three entries to show that such loading was actually done from the factory of the said applicant. In that respect also, one of the entry in the trip register reflected the names as 'SUKEGHRAM", thus, casting doubt on the same. In most of the cases, no trip register is available. As such, it stand submitted before us that in absence of any evidence worthy of reliance, the conclusion arrived at by Commissioner are in the nature of assumptions and presumptions. 14. Countering the argumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground that cross examination of 35 persons have been sought but no justification for the same has been given. He also rejected the request for cross-examination on the ground that no statement made by the said suppliers stand retracted. We do not find any justification for denial of such request. If the statements of traders (whether retracted or not) is sought to be relied upon in the show cause notice it was incumbent on the part of the Revenue to tender the above witnesses for cross examination. The statements of traders being in the nature of statement of co-accused, cannot be relied upon without putting the same through the test of cross examination. However, we do not feel inclined to remand the matter on this ground inasmuch as all the traders appearing before us have again reiterated their stand that no goods were actually supplied by them to M/s. A.S. CORPORATION under the cover of invoices raised by them and it was only bills which were issued against which payments were received by them by cheque from M/s. A.S. CORPORATION. 16. As regards merits of the case, we find that the adjudicating authority has properly framed the disputed issue with which we shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the trade name "SULEKHRAIM". It has to be also borne in mind that all the purchases in their statements have deposed that they bought the goods from M/s. A.S. Corporation to whom payments were made in cheque or demand draft and not even a single buyer has stated that the goods were purchased from M/s. Sulekhram Steels P. Ltd. 18. The Commissioner has further framed the issue as to from where M/s. A.S. CORPORATION has procured the TMT bars bearing mark of "SULEKHRAM" embossed on them. For answering the above proposition, he relied upon the trip registers maintained by transporters as also statement of the transporters indicating that the goods were being lifted from the factory of M/s. SULEKHRAM STEEL PVT LTD. While making the statement, transporters has referred to trip registers maintained by them. Copies of such trip registers stand produced before us and we find that except entries in three places, the trip registers nowhere indicates that the goods were actually loaded from the premises of M/s. SULEKHRAM STEEL PVT. LTD. In fact, no trip registers are available in most of the cases and wherever they are available, no such entry showing loading of the goods from the factory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . CORPORATION and he only clarified that on comparison of two, it seems that no invoices were issued as regards the entries reflected in the worksheet. We find the above submission to be correct. Shri Pankaj Trivedi, has simply Stated that as per the worksheet, TMT/CTD bars totally valued at Rs. 7.79 crores approx. involving Central Excise duty of Rs. 1.06 crores approx. have been cleared from their factory. The above statement cannot be held to be an admission inasmuch as the same was made by the said deponent after comparison of the two records shown to him and he made it clear that as per the worksheet prepared by Revenue, the clearances were effected without payment of duty. 21. Commissioner has also observed that it is a settled law that what is admitted need not be proved and has referred to various decisions of the Tribunal. Accordingly, he has concluded that admitted facts need not be corroborated. We are of the view that the above phrase i.e. "what is admitted need not be proved" stand mis-interpreted by the adjudicating authority. We are at a loss to understand as to what stand admitted and by whom. The appellants are definitely agitating the allegations in the show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Neither of the said factors stand investigated and the entire case stand made on the basis of statement of traders and buyers of M/s. A.S. CORPORATION. It stand further noted that M/s. A.S. CORPORATION has nowhere admitted having purchased the goods from M/s. SULEKHRAM STEEL PVT. LTD. without payment of duty, neither is there any statement of any representative of M/s. SULEKHRAM STEEL PVT. LTD. admitting having cleared the huge quantum of the goods without payment of duty. Under these circumstances, we are of the view that there is no sufficient material on record to establish clandestine manufacture and clearance by M/s. SULEKHRAM STEEL PVT. LTD. We, accordingly, set aside the confirmation of demand and imposition of penalty under Section 11AC as also Rule 25 of Central Excise Rules. Penalty of Rs. 10 lakhs imposed upon Shri Chhajusingh S. Kanwal, Chairman cum Managing Director of M/s. SULEKHRAM STEEL PVT. LTD. has also been set aside. 23. As regards penalty of Rs. 5 lakhs imposed upon Shri S.A. Vohra, Partner of M/s. A.S. CORPORATION, we find that the same has been imposed upon him in terms of provisions of Rule 26 of Central Excise Rules, 2002 on the ground that he was fu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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