9911796707
TMI Blog2016 (1) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... ll settled law that such statements, though, form part of the evidence, have to be taken with a pinch of salt and require further corroboration. The Revenue cannot rest its case on the sole basis of the statements without taking into account the surrounding circumstances. As such in the absence of any reference by the said deponents, to the fact of passing of quality control test about a week ago and in the absence of any admission that the same were not entered with any malafide intention to remove them clandestinely. Regarding source of scrap - the assessee have produced invoices of two persons showing the sale of the scrap on the previous night of the visit of the officers. No enquiries stand made by the Revenue from the said two sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification of the finished goods stock revealed that Ad brass pipes to the extent of 15946.921 Kgs and cupro nickel pipes to the extent of 211 kgs were not entered in the daily stock register RG-I. On a reasonable belief that the same were meant for clandestine removal, the officers seized the same. 3. During the course of post seizure investigations, the statements of various persons were recorded. Shri Bhanwar Lal Ramavat Dy General Manager (Production Tools) in his statement dated 26.03.2008 agreed with the panchnama proceedings and submitted that he was not aware of the source of acquisition of the scrap and the finished products were manufactured in their factory about 10 days back and passed quality checks around 7 days back. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d cupro nickel pipes were manufactured a week back, the same were subsequently subjected to eddy current, hydrotest, surface inspection, dimensional inspection, lengths cutting etc. The said goods finally passed the tests on 24.03.2008 and were released for weighment and packing which was completed on the said date at around 22.00 hours. Inasmuch as the officers visited their factory on 25.03.2008 at 8.00 AM in the morning, the goods could not be entered in the records. They also produced two invoices from Manmohan Electricals and Nanda Kishore Dinesh Kumar showing the sale of the scrap in question. 7. The Commissioner vide his impugned order however, did not accept the assessee's submissions and recorded that almost all the employ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing authority has confiscated the finally manufactured products, which according to the Revenue were not entered in RG-I records. The adjudicating authority has primarily relied upon the statements made by various persons at the time of visit of the officers. However, it is seen that within a period of 3-4 days, the assessee had addressed a letter to the concerned officer indicating that the tubes and pipes were, though manufactured about a week back, but passed the quality control test only the previous day and were yet to be entered in the records. The adjudicating authority has not rebutted the assessee claim that the said goods are required to pass stringent quality control test like eddy current, hydrotest, surface inspection, dimensio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am of the opinion that confiscation of the final products and imposition of penalties upon the assessee is neither justified nor warranted. Accordingly, the impugned order of Commissioner is set aside and assessee's appeal is allowed with consequential relief to him. 11. As regards the Revenue's appeal, against that part of the impugned order of Commissioner, vide which he has dropped the proposal to confiscate the scrap, I find no infirmity in the same inasmuch as it is well settled that noncenvatable raw materials cannot be confiscated on the ground of their non-entry in the records. Apart from that, I also find that the assessee have produced invoices of two persons showing the sale of the scrap on the previous night of the v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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