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TMI Blog2013 (8) TMI 769X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the statement which was required to substantiate the case of diversion of imported goods - The finding/remarks were unsubstantiated as in the entire case record there was no evidence to claim that the appellant had been resorting to making deliberate entries in RG-1 register. Whether the Removal of the Goods were clandestine Removal - As decided in ASSISTANT COLLECTOR OF CUSTOMS Versus KUNHI KORATH BALAN [ 1990 (8) TMI 156 - HIGH COURT OF JUDICATURE AT BOMBAY] - The Panchnama was faulty, no adverse inference can be drawn and such Panchnama had to be excluded from the consideration of the case against any person - shortage of goods in itself does not mean that clandestine removal and clandestine removal needed to be proved by the Department and also for the proposition that the assessee was entitled to give proper explanation of the difference in stock taking even at the time of the reply to the show cause notice - appeals were allowed by way of remand – Decided in favor of Assesse. - Appeal No.E/3086-3088/2003 - - - Dated:- 9-10-2012 - Mr. M.V. Ravindran and Mr. B.S.V. Murthy, JJ. For the Appellant: Shri J.C. Patel, Adv. For the Respondent: Dr. Jeetesh Nagori, Add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... foregone by the Department along with interest and imposed penalties on the main appellant as well as two directors. Hence these appeals. 3. Ld.Counsel appearing on behalf of the appellant would submit that the Panchnama which was drawn by the authorities is improper and the said panchnama was disputed by Shri Rameshchandra Agarwal. It is his submission that the affidavit of retraction was filed on 01.09.2000 in support of which he draws our attention to Page No.268 to 272 of appeal memorandum. It is submission that the Panchnama was disputed on the ground that the Panch witness Shri Hirabhai Patel was not present on 29.08.2000 and had come only on 30.08.2000 and his signature was taken forcibly on the Panchnama, physical stock of the finished products was not taken and was not compared with the readymade garments appearing in RG-1 register, Panchnama did not record the fabrics which were in the process on the machine which were working and the officers recorded the names of the persons to whom the appellants allegedly has sold the imported fabrics from the appellants telephone directory and recorded the same in the statement. It is his submission that the Panchnama witness Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s used in the export goods was inferior/indigenous fabrics. It is his submission that on 13.07.2000, the Panchnama was drawn by Excise authorities to verify the receipt of the fabrics imported by the appellant and it clearly indicate that the imported fabrics has been ware-housed and that the same is at different stages of manufacturer and the stock tallying with the books. It is his submission that without prejudice to the submissions made, the duty demand raised in the show cause notice is Rs.18.1 Crores which is very inflated as the duty liability foregone by the Department of imported fabrics was only Rs.10 crores. It is his submission that this fact is ascertainable from the show cause notice itself. 3.1. He would rely upon the decision of Hon'ble High Court of Mumbai in the case of Kunhi Korath Balan 1991 (53) ELT 178 (Bom.), holding that if the Panchnama is faulty, no adverse inference can be drawn and such Panchnama has to be excluded from the consideration of the case against any person. He would also rely upon the following decisions for the proposition that shortage of goods in itself does not mean that clandestine removal and clandestine removal needs to be proved by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat that the contention of the appellant that physical stock was not compared with RG-1 record and shortage was worked out on the basis of receipt of the imported goods minus the consumption is baseless as whole contention of the Department is that the entries made in RG-1 register itself were suspect. It is his submission that the appellant had now disputed the Panchnama and the stock taking, he should have done so when the authorities were conducting stock taking instead of challenging the same at the adjudication stage. It is also his submission that the Superintendent, Central Excise, who conducted the stock taking, in his cross-examination, has categorically stated that all the available stock in the factory was considered during the stock taking. He would rely upon the decision in the case of Swastik Industries 2002 (142) ELT 710 (Tri-Kolkata) and in the case of Bindawala Cables Conductors Ltd 2002 (147) ELT 656 (Tri-Kolkata). It is his submission that defence of non-granting of cross-examination of brokers is not sustainable as the adjudicating authority has not relied upon the said statement to come to conclusion regarding clandestine removal/diversion of imported fabrics ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 84,467 pcs 46,568.50 Mtrs c) Punjabi Suit 6,357 pcs 41,320.50 Mtrs d) Gents Shirts 8,850 pcs 22,125.00 Mtrs e) T Shirts 3,000 pcs 6,000.00 Mtrs 5,83,999,00 Mtrs (B) DTA Sales a) Ladies Nighty 8,060 pcs 36,270.00 Mtrs b) Punjabi Suit 3,215 pcs 20,897.50 Mtrs c) Gents Jackets 5,025 pcs 22,612.50 Mtrs d) Ladies Long Coat 2,945 pcs 25,032.50 Mtrs e) Trousers 7,470 pcs 13,072.50 Mtrs f) Ladies Scarf 69,395 pcs 76,330.00 Mtrs 1,94,219.50 Mtrs (C) Defective (Rejects) Garments dispatched 13,744.00 Mtrs Total Dispatches:- 7,91,962.50 Mtrs Total Receipts 21,18,747.94 Mtrs Total Dispatches 7,91,962.50 Mtrs 13,26,785.44 Mtrs As per the Panchnama as against the said stock of 13,26,785.44 Mtrs, on physical verification, the stock found was 3,00,023.41 Mtr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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