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TMI Blog2018 (8) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... outs the rigours of Section 36B of CEA, 1944 has to be fulfilled but the same has not been followed in their case - The Revenue has not conducted investigation regarding the supply made to the person whose name is found to be entered in the Register if it is for clearance of finished goods clandestinely. Appeal allowed - decided in favor of appellant. - Excise Appeal Nos. 70035, 70135 to 70138, 70178, 72095/2013 & 76682/2014 - FO/76450-76457/2018 - Dated:- 23-7-2018 - Shri P.K. Choudhary, Member (Judicial) And Shri Bijay Kumar, Member (Technical) Shri B.N. Chattopadhyay, Consultant for 2,4 5 NONE for 1,3,6,7 8 for the Appellant (s) Sri K. Choudhari, Supdt. (A.R.) for the Respondent (s) ORDER Per Shri Bijay Kumar These appeals are directed against the Order-in-Original No. 11/Commr./CE/Kol-III/2012-13 dated- 07/12/2012 passed by the Commissioner of Central Excise, Kolkata-III wherein Central Excise duty demanded to the extent of ₹ 1,16,92,418/- alongwith equal penalty under the provisions of Central Excise Act, 1994 (in short Act ) i.e. under Section 11A2 and Section 11AC of the Act read with Rule 25 of Central Excise Rules, 2002 (in short r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009, raw materials like ink, ethyl acetate, hardener, adhesive etc. were supplied to the appellant on the basis of hand written challans and payments against all such receipts were remitted by cash by the appellant; that Shri Chinmoy Kumar supplier of polyethylene sheets have stated that Shri Sanjoy Lakhotia, Managing Director of the appellant used to contact with him over phone for supply of polyethylene sheets since January, 2009 and most of the payments were made to him in cash. In this regard, the appellants stated that the statements were taken from only two of the suppliers of raw materials and the same could not and should not represent so many suppliers from whom they purchased various raw materials. In addition to that, the Appellant submitted that the statements were taken behind their back and therefore, cannot be relied upon. In this regard they referred to the decision of Hon ble Apex Court and relied upon the decision of Hon ble Supreme Court in case of Gyan Chand Vs. Union of India reported in 1985, ECR 223 (S.C.). Also, the appellant relied upon the decision of R. Sunder Vs. Deputy Collector of Customs reported in 1996 (82) ELT 451 wherein it is held that the stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om page 1 to 565 taken from one of the CPU of the computer, the appellant submits that the computer was resumed by the departmental officer without proper sealing thereof and the printouts were taken after three months of seizure; that the print out is not admissible evidence under Rule 36B of the Act; that the allegations made on the basis of computer print outs had not been corroborated by any other evidences. The appellant also argues that as per the computer print out, the total quantity of 900 MT of different variety of the products were sold to individuals without invoice in addition to 229 MT of manufactured goods sold as per the invoices; that if these two quantities are taken together, the total quantity came to 1129 tons which is beyond the capacity of all their machines installed in their factory even if runs together 24x7x365. Therefore, the CPU data cannot be taken to be true ; that the integrity of data said to have been taken from unsealed condition and that too in the appellant s back is not acceptable, in view of the fact that the chance of data being tampered could not be ruled out; that the said computer was not in regular use and the statement of the persons who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means the price charged to the goods by the seller. In a given transaction, Section 4 (1) (a) of the Act is the price is a sale consideration and the buyers is not related to the assessee and then on each removal, challans had been taken on the transaction value. It is evident from their sales record that they have sold the products at different rates to different customers by calculating the duty demand but the Department has taken into account the highest price for the product without considering the price of each and every transaction. The appellant also said that even if presumed that they have indulged into the clandestine removal of the goods after the purchase of the raw material from the various suppliers, they should be extended the benefit of CENVAT Credit in view of following decisions : (i) Mahabir Plastics Vs. CCE, Mumbai-2010 (255) ELT 241 (ii) CCE Vs. Marine Electricals-2006 (205) ELT 261 (iii) Apex Steels (P) Ltd. Vs. CCE-1995 (80) ELT 368 (iv) CCE Vs. Re-rolling Mills-2009 (159) ELT 192. The appellant has further submitted that they have deposited a sum of ₹ 10.00 Lakhs during the investigation. The same cannot be treated as the voluntary paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture nor do they have the machines, infrastructure etc. to do so. The said items have been falsely and wrongly taken as sales. Apart from the above, appellant also submitted that assuming, although denying that they manufactured and cleared goods clandestinely, the excise duty has been calculated on cum-duty price, that is, the excise duty has been calculated on the basis of the price, allegedly at which we sold the goods; that it is well settled that the assessable value is to be determined after deducting the excise duty from the price charged, as held in the case of Nirula Co. (P) Ltd.-2003 (156) ELT 583. Similar view has been taken in the case of Premier Electrodes Ltd. Vs. CCE, Nasik-2007 (211) ELT 621. In the case of CCE Vs. Maruti Udyog Ltd.-2002 (141) ELT 3 wherein the Apex Court has held that Sale price realized by the assessee to be regarded as the entire price inclusive of excise duty .In determining the value on which excise duty is payable, the element of excise duty sales tax or other taxes which is included in the price, is to be excluded in arriving at the assessable value. The demand of duty calculated on the basis of sale is not sustainable. The Appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2014 (307) ELT 862 (Bom.) iii) Sudhir Sharma Vs. Commr. of Customs [2015 (319) E.L.T. 450 (Del.) wherein it is held that in every cases the cross examination is not required and the Ld. D.R. said that non-allowance of the cross objection by the adjudicating authority in its vitiated the proceedings and the corroborative evidence have been obtained and made applicable to the appellant. 9. We have heard the parties and perused the case records. The issue involved in this case is regarding the clandestine removal of goods by the appellant. From the record made available to us by the Ld. Consultant on behalf of appellant, it is seen that most of the entries are made in such a way that it is difficult to arrive at a conclusion about sales and purchase of raw materials and finished goods. We find from the records and registers made available to us that entries are made in a cryptic manner that too after so many alterations. This leads us nowhere to conclude that Appellant has indulged in the clandestine removal. We have also perused the statements recorded by the various persons wherein in some statements, it is stated that there was cash sales also but this in itself would not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n cash payment on the basis of instruction of Shri Sanjoy Lakhotia; MD, of the appellant company but for the remaining supplier of the raw material, which is stated to be more than 130, has neither been examined nor their statements were recorded to coroborate the quantity of raw material supplied. The statements of the two suppliers who has stated they used to supply the goods on cash payment have not been subjected to examination in Chief cross examination, so these statements loose their evidentiary value. 11. Regarding acceptance of computer printouts as the evidence only after passing the test of examination and cross examination of the person responsible for feeding such data. Before acceptance of computer printouts the rigours of Section 36B of CEA, 1944 has to be fulfilled but the same has not been followed in their case. The appellant has stated in a clear and categorical term that the computer from which the CPU has been taken out had not been put to use for several months. Also, the seizure of CPU without following the due process of sealing the same and re-opening the same in presence of Appellant is representative casts serious doubt about the integrity of data cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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