9911796707
TMI Blog2018 (11) TMI 1278X X X X Extracts X X X X X X X X Extracts X X X X ..... ny authentication or signature of any authority competent to do so and is not specifically admitted by any of the executives of the company. No discrepancy has been found in the stock of finished goods or in procurement in the factory and the entire production has been recorded against serially numbered casting slips, with supporting weighment slips. It is a well settled principle that to establish clandestine removal, tangible, strict, positive, concrete, direct, circumstantial and corroborative evidences are required which must form a complete chain to rule out any preponderance of probabilities and lead to inescapable conclusion - While in the instant case allegations have been made solely on the basis of tentative private records and data and no discrepancy has been noticed in the procurement of raw materials/power or stock of raw materials/finished goods. The allegation has been raised on the basis of hypothetical and illogical input-output ratio of iron ore to pig iron at 1.233 MT, which if compared with the average ratio of comparable manufacturing units, is much lower. Ratio of 1.233 MT is practically impossible to achieve not only for NML but also for any other co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Manganese are procured from local sources. Electricity is procured from state utility of DVC Power Corporation as also from captive generation and Diesel Generating Sets. The quality and quantity of production depends on the quality of Iron Ore and Coke and other inputs. ii) Typically, the gross requirement of Iron Ore is 1.9 MT and that of Coke is 0.85 MT for producing 1 MT of Pig Iron. The said ratio is also submitted in ER-5 filed by the appellant. The consumption pattern duly matches the industry standards when compared with other local industries viz. Tata Metaliks and KIC Metaliks. iii) In the MBF, all raw materials are fed after screening. It cannot be fed as such. Thereby Iron Ore, Coke, Limestone, dolomite etc. are screened and then fed in the furnace. The technical literature of the MBF manufacturer M/s Tata Korf Engineering is relied in support of the same. iv) Such screening, multiple handling of iron ore result into generation of iron ore fines. Such generation of iron ore fines is duly recorded in the Central Excise records, furnished in monthly returns. The market for iron ore fines is limited. However, it was locally cleared/sold but with good amount of han ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ock and dispatch of finished goods etc. Further, no unaccounted cash or unaccounted stock of material etc. was also found in the premises of the Appellant. The DGCEI officials had also conducted search at the business premises of the Courier Company and seized certain documents alleging that the same belongs to the Appellant. Further, the DGCEI official also visited premises of few customers of the Appellant on the even date. However, admittedly no incriminating documents have been recovered by them. After the search conducted on 07.08.2008, DGCEI officials carried on the investigation for almost a period of four years and Executives of the Appellant company were summoned, from time to time, for recording statements, verification of documents etc. The Appellant Company and it s Executives extended full cooperation during the search as well as the investigation. During the search and also in the course of investigation, the DGCEI officials exerted pressure on the executives and recorded their statements under duress and coercion. Subsequent to the search on 07.08.2008, Mr. Gulati and Mr. Kedia reported the fact of such duress and coercion on 11.08.2008 12.08.2008 respectively, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re seized and taken away. After several months, the department on their own efforts produced listing of the purported SMS and its contents showing certain figures, which the SCN described as clandestine production and removal. It has been confirmed in the SCN (Para.27 page No.124) that they had approached the cell phone service providers to retrieve the SMS data but the cell phone service provider had refused the service since they did not have the backup data. That apart, the fact that the contents of the SMS were discretely ascertained is evident from the comments of Mr. Dipak Pradhan, employee handling IT issues of the assessee company in saying only print outs taken before me . Thus, it appears that the entire SMS listing is unverified and does not bear any authentication or signature of any authority competent to do so and is not specifically admitted by any of the executives of the company. 7. We also find that the actual production figures are recorded in the case wise register, DSA (Daily Stock Account) of the Appellant. Furthermore, the statements recovered from Mr. Gulati s Laptop on whose basis the entire allegation has been raised itself uses the term theoretical p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We do not agree with the Revenue s stand taken by them in the memo of appeal that standard of proof in such cases has to be necessarily on the basis of preponderance of probabilities and not on the basis of absolute proof. 9. We also find that the assessee had duly recorded the production of Pig Iron against each casting as per the weighment slips accompanying the PCM Slips. There is no allegation or finding in the SCN or the OIO that the assessee has not reported the production against each Cast. Reference of each any every Cast is serially available in the records, log books of the appellant. On the basis of PCM slips the Cast Register/DSA is being maintained. The Cast Register on the basis of each cast wise production, being not a matter of dispute at the outset, relying upon alleged SMS/s, without any evidence, unverified, incomplete, informal and uncorroborated data to disown the cast register is incorrect. 10. We further find that the four sets of parallel invoices recovered from the Courier Company were those invoices which were though raised but against which pig iron were never dispatched due to disagreement over rate of pig iron and thus the said invoices were can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... namely, Shri Shyam Industries Pvt. Ltd. Durgapur Iron Steel Co. Ltd., to the effect the search was conducted by the DGCEI in their premises and no incriminating records/ documents have been seized. It has been alleged that on comparing the weights of Pig Iron manufactured mentioned in the PCM slips and the attached Weighment Slips, recovered from the Courier Company, with the weight recorded in Cast-wise Register difference between the two records were found for certain cast Nos., wherein a lesser quantity is recorded in Cast Register. Furthermore, the Department has alleged that the appellant M/s NML has changed the format of PCM Slips purposefully by removing the weights column to effect clandestine clearance and with a view to minimize the number of persons having knowledge of the inside story. 12. We find that Mr. Kedia in his statement on 02.07.2010 and 03.07.2010 explained that Cast no. shown in PCM slips, are posted in Cast Register which is the actual production. This DGCEI officers have not tried to cross tally the figure of production shown in DSA with Cast Register, otherwise it would have been found that the quantity shown in Cast Register is the actual produc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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