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TMI Blog2018 (6) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... a search in the premises of the appellants on 08/06/2001 wherein the stocks were verified and also certain records were resumed. Follow up searches had also been conducted in the premises of some customers and transporters of the appellants. Both the assessees/appellants are sister concern and some of the buyers and transporters are common. Subsequently, separate show cause notices of even date 09/01/2003 were issued. 3. Appeal No. E/2979 of 2005, J.M. Agarwal Tobacco Company: - It is alleged in the SCN that Shri Chandra Prakash Agarwal father of Laxmi Narain Agarwal in his statement recorded under Section 14 on the day of search inter-alia admitted the clandestine purchase of raw tobacco and shortage of 1682.50Kg of raw tobacco noticed during the stock taking. Subsequently, premises of five buyers located in Assam and two transporters one at Kaimganj and the other at Kanpur were also searched. Subsequently, during September, 2002, premises of another 14 buyers located in Assam were searched. As a result of searches some documents were recovered from the buyers. It appeared to Revenue that there were some mismatches in the invoices issued and the GR's found from the premises ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir dealers/distributors. Another letter dated 20/06/2001 written by M/s Nagar Mal Push Raj addressed to appellant stating that 16 cartons of "Bandar Brand" 'Sada' had been received by them towards adjustment of pending lucky coupon claimed amount of Rs. 17,330/- on which it appeared no duty was paid. Hence it appeared that appellant had been dispatching finished goods in place of gift items under the promotion scheme and on such dispatches no duty have been paid. 5. In his statement recorded on 21/11/2001 Shri Laxmi Narain Agarwal inter-alia admitted the manner of clandestine removal of the said goods. An amount of Rs. 12 lakhs was voluntary deposited by appellant vide TR-6 Challan dated 02/07/2001 and 03/07/2001 as advance Central Excise duty towards the probable liability. 6. While in most of the cases the details mentioned in the GR's tallied with those indicated in the Central Excise duty paying invoices, issued on a particular day, but in some of the cases the weight shown in the GR's was found more than that shown in the corresponding Central Excise Invoices. This differential weight appeared to be the quantity of goods dispatched clandestinely from appellant main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom one godown to the other. However this contention appeared to be not correct inasmuch as goods shown there in and removed from the Permanand Mill dated on 24/04/2001 and 29/04/2001, has remarks in the description column of the said page suggesting clearance of finished goods to one Shri Soneylal. 8. In the further statements of Laxmi Narain Agarwal, it appeared that their family-owned 4 firms/company namely - J.M. Agarwal Tobacco Company (firm), J.M. Agarwal Tobacco Company Pvt. Ltd., Satya Prakash & Company and Shri Ram Chandra Prakash. M/s SRCP purchases raw tobacco from the farmers and manufacture different grade of raw tobacco with leaves of raw tobacco - 'Garia' are crushed to produce three different grades of raw tobacco namely 'Orcha Dana', 'Rawa' and 'Garda'. Further by crushing wood of the said raw tobacco - 'Garia', 'Nas Dana', 'Nas Rawa' and 'Nas Bukki' are obtained. That SRCP sells 'Patti Dana' & 'Nas Dana' so obtained to the appellant. 9. Based on such allegations, SCN proposed to demand Central Excise duty of Rs. 90,31,720/- for the period 1998-99 to 2001-02 as detailed in Annexure A to the SCN invoking the extended period of limitation; further proposing penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s an excess weight of 08Kg as per the GR as compared to the invoice. Similarly with respect to GR No.12 dated 8th of July, 1999 the number of bags 425 and weight is 4975Kg dispatched to Sitaram Om Prakash, Assam wherein as per invoice the number of bags is tallying the weight as per invoices 4972.5 thus a difference of 2.5Kg only. Thus it is evident that the nominal difference of about 1% or 2% is due to weight of the packing material. In the invoice the appellant gives the weight of the goods as tobacco is normally sold by weight. Whereas the transporters waste the finally packed goods which include secondary packing and that there is bound to be some nominal difference calling for no adverse inference. 12. The learned counsel further points out from the statement recorded of Shri Laxmi Narain Agarwal on 21/11/2001 wherein in answer to the question - with respect to GR No.49 dated 31/07/1999 shows weight of consignment 9620Kg whereas the invoice No.106 dated 31/07/1999 reflects weight 8970Kg. Thus there is difference of 65Kg, please explain. In reply it was answered that from time to time along with the dispatch of finished goods, they also dispatch advertisement and publicity ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Shri Laxmi Narain Agarwal was confronted with the said page of the said diary and in his statement he inter-alia stated that he ascertained from his father Shri Chandra Prakash Agarwal this account 'titling milk', was the amount of clandestine sale of the finished goods by the appellant firm in the nearby places. That it appeared to Revenue that milk was the codeword used for accounting the clandestine removal of goods valued at Rs. 18.01 lakhs. The learned counsel further points out that it is recorded in the impugned order by the learned Commissioner that immediately after two days on 10th of November, 2001 Shri Laxmi Narain Agarwal retracted his statement as a same having been obtained under coercion from him by the Revenue officers. A copy of the said retraction dated 10th of November, 2011 have been placed in the appeal paper book as Annexure 11 wherein it is categorically stated that he is not aware for what purpose Shri Chandra Prakash Agarwal made those entries. The said retraction was made by way of an affidavit sworn before the Notary Public. However the learned Commissioner treating their retraction statement as an afterthought did not rely on the same observi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (245) E.L.T. 211, wherein Division Bench of the Tribunal have held that on account of weight difference in the invoices and in consignment note, no adverse inference can be drawn when the consignment note prepared by the transporter contains weight of packaging material as well as gift articles supplied to dealers/customers and there was correlation by the customer/dealers regarding the fact of receipt of gift articles, the demand on account of difference of weight was held to be not sustainable. 16. Portland Cement India Ltd., vs. CCE 2015 (326) E.L.T. 304 (Tri.-Del.), wherein also some loose papers resumed from the factory premises without bearing name of factory and description of goods. It was held that slips are not sufficient to establish charge of clandestine manufacture and clearance of goods. Though some of the persons name was there on the slips but none of the persons brought on record to establish the fact that such pertain to the transaction of the assessee. In absence of proper investigation conducted from related persons to the said transaction, the charge of clandestine removal is not tenable mainly on the basis of confessional statement of director without there b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny further investigation and enquiry from the author of the entry Shri Chandra Prakash Agarwal. Thus, I find this demand to be simply presumptive in nature without any cogent evidence brought on record. Accordingly, I set aside this demand of Rs. 6,00,640/-. 20. As regards the demand of Rs. 2,39,574/- on the basis of loose sheet recovered from the factory premises, I find that a cogent explanation was given during the investigation particularly the statement recorded of Shri Chandra Prakash Agarwal, wherein he stated that these are rough calculations in relation to purchase and sale of tobacco etc. Further it has come on record that the appellants purchase raw tobacco which is not dutiable. Revenue has not made any enquiry as to the nature of such entries, as to its period and as to which party with whom such transactions were entered. From perusal of the said page available on the appeal paper book, I find that there are no dates, only amount and account had been mentioned against the amount. Accordingly, I find that the demand is simply presumptive and un-substantiated. Accordingly, I hold that the said loose paper/sheet does not lead to any evidence of procuring any dutiable in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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