9911796707
TMI Blog2018 (9) TMI 496X X X X Extracts X X X X X X X X Extracts X X X X ..... sultant. It is not even Revenue s claim that during the course of adjudication, it asked any query from the assessee for directing her to furnish the bank statement etc. to find out possible connection with respect to any payments made or other financial connection with Ms. Janki Sharma. The inference that the Revenue sought to draw a reference to ATM ; the link it sought to make by the statement of Ms. Janki Sharma. There was no scrap of paper or evidence linking the assessee with any allegations levelled against it vis- -vis excess production and clandestine removal. On the other hand, the CESTAT noticed that the assessee s installed capacity was the production of five ton of copper ingots. Apparently, the assessee was able to function only half the month i.e. for about 15 days. The questions of law framed are answered against the Revenue and in favor of the assessee - Appeal dismissed. - CEAC 29/2017 - - - Dated:- 29-8-2018 - MR. S. RAVINDRA BHAT AND MR. A. K. CHAWLA JJ. Petitioner Through: Mr. Harpreet Singh, Sr. Standing Counsel. Respondent Through: Mr. V.S. Negi and Mr. Satish Chander Kaul, Advocates. MR. S. RAVINDRA BHAT (ORAL) The questions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -wise details of transaction and a consolidated details of sale and purchase made by M/s. ATM. The scrutiny of the seized printouts and the particulars mentioned therein from page no: 1 to 122 and from page no. 132 to 165 reveal that they were showing the party-wise ledger account of payment details, purchase of copper scrap, purchase account, sale of copper ingots and receipt of payment in cash. The details mentioned at page no. 123 to 131 are a consolidated statement which is in respect of parties to whom copper ingots/rods were sold clandestinely by M/s. ATM. The total sale of copper ingots/rods was shown for an amount of ₹ 18,22,35,303.30/- at page-131 for a period from 02.03.05 to 06.05.05. 39.1 Similarly another set of printout was also generated as per page numbered from 1 to 209, relating to the account of SHIVA . As stated by Smt. Janki Sharma, the trarnsactions entered in the SHIVA account are created in respect of Ashutosh Metal Industries in order to keep some of its transactions related to clandestine removal. The details given in this account are maintained in an identical manner like ATM account. It is seen that ATM account are maintained up to 06.05.05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring search from Smt. Janki Sharma. However, while entering these data in the computer, only relevant information such as receipt payment details were entered and hence the printouts of ledger did not show the quantity. 40. Further, a huge quantity of unaccounted production and subsequent clearance thereof is corroborated from the evidence of higher consumption of LDO used in furnace which was purchased unaccounted; however some surreptitious purchases were recorded in computer data base as seen from the printouts recovered. 40.1 On scrutiny of the seized print outs marked as ATM account from page 1 to 165 and the details mentioned therein at page no. 67 of the above ATM account in respect of LDO from 01.03.05 to 05.05.05, it was observed that the noticee purchased LDO for an amount of ₹ 29,97,380/- during the aforesaid period which was paid in cash. The contents of page 67 can better be appreciated by looking at the scanned copy of the relevant page (incorporated in the show cause notice) reflecting the purchase of LDO. 40.2 Similarly on scrutiny of the seized print out marked as 'SHIVA' Account from page 1 to 209, the details of page 77 show ledger ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed out any investigation on the buyers who are alleged to have purchased these finished goods, in cash without payment of duty. From the records recovered from the factory, there is no evidence of any physical receipt of raw materials used in production of such a huge quantity of finished goods. In fact on the date of search, no discrepancy was recorded in respect of stock of raw materials and finished goods vis-a-vis that recorded in statutory records. The Revenue has also not bothered to investigate about the transportation of raw materials as well as finished products. The total quantum of alleged clandestine. production and clearance also show an over estimation, keeping in view the production capacity estimated by the Commissioner himself in the impugned order. 12. It is true that the evidence which is required to be produced in quasi judicial proceedings should be such that the charges get established on the basis of preponderance of probability. The standard of evidences need not be as high as in criminal proceedings, where the charges are required to be established beyond reasonable doubts. But in the present case, we are of the view that the allegation of clandestine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hes to prove the contrary. It was contended that in the present case, the respondent/assessee was aware of the nature of the material gathered and used against it in the form of the confessional statement of Ms. Janki Sharma as well as computer printouts and electronic evidence and that it could not dispel the reasonable inference that the Revenue proved against it. 6. It is evident from the above discussion as well as complete reading of the orders of the Adjudicating Officer and the CESTAT that the case built up against the assessee is entirely based on the evidence procured from third party. The lynchpin of the Revenue s case is the statement of Ms. Janki Sharma. Concededly, there was nothing recovered from the premises of assessee connecting it with her-either as an employee or as a consultant. It is not even Revenue s claim that during the course of adjudication, it asked any query from the assessee for directing her to furnish the bank statement etc. to find out possible connection with respect to any payments made or other financial connection with Ms. Janki Sharma. In these circumstances, the word of Ms. Janki Sharma against the respondent/assessee was entirely hearsay o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of paper or evidence linking the assessee with any allegations levelled against it vis- -vis excess production and clandestine removal. On the other hand, the CESTAT noticed that the assessee s installed capacity was the production of five ton of copper ingots. Apparently, the assessee was able to function only half the month i.e. for about 15 days. Given this established and known capacity, the mere circumstance that the assessee had procured diesel equivalent to ₹ 29,00,000/- without any further calculation could not have led the Adjudicating Authority to conclude that clandestine removal to the extent of ₹ 8,30,53,761/- was made. The value of the goods, in that event was ₹ 50,89,07,851.88. The Court is of the opinion that the sheer probability of the allegations and sketchy nature of the material relied upon by the Revenue to base its liability could not therefore have been sustained. The CESTAT in our opinion correctly held that the assessee s appeal deserved to be allowed. 8. For the above reasons, the questions of law framed are answered against the Revenue and in favour of the assessee. The appeal is consequently dismissed. - - TaxTMI - TMITax - Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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