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TMI Blog2019 (6) TMI 869X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 15/02/2018 passed by the Commissioner (Appeals) Customs, CGST and Customs and Central Excise, Indore. Vide the impugned order learned Commissioner (Appeals) has confirmed the Order-in-Original No. 86-87/ADC/CEX/IND/2015-16 dated 05.11.2015. By the said Order-in-Original the primary Adjudicating Authority has confirmed the demand against the appellant , namely, M/s Ganpati Structures Private Limited Plot No. 8 Sector E, Industrial Area Sanwer Road, Indore (MP) and also on its Director Shri Ashok Joshi against whom penalty was imposed. The Order-in-Original was in respect of two Show Cause Notices dated 16/07/2010 and 11/02/2004. Aggrieved by the impugned order appellants have preferred these appeal. 2. Brief facts of the case are that the appellant, M/s Ganpati Structure is engaged in production and clearance of steel re-rolling products falling under chapter 72 and 73 of Schedule two Central Excise Tariff Act, 1985. The officers of Central Excise, Indore conducted a search on the appellant s premises on 23/09/2009 and also conducted stock verification of raw material and finished goods and detained finished goods and raw materials worth ₹ 41,52,864/- which w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble on the finished goods which were seized on 20/01/2010 on account of the fact that the appellant was availing SSI exemption under Notification No. 08/2003(supra), and therefore, it was not required to maintain any statutory records. However, all the finished goods were entered in their computer record and also subsequent the visit of the excise officer the appellant had applied for the Central Excise Registration, and therefore, the stock lying in the factory could not have been seized by the Departmental Officer. Further also, it was submitted that the stock verification was done on the eye estimation basis without actual weighment thereof. Such type of stock verification on the eye estimation basis has been found to be not sustainable in view of various decisions of Hon ble Tribunal and other superior courts. Even otherwise, redemption fine of ₹ 8,00,000 which has been imposed is much in excess as the duty involved on seized goods were only to the extent ₹ 3,21,510/- only. Also penalty of ₹ 12,00,000/- under Rule 25 of Central Excise Rules 2002 (hereinafter referred to as Rules ) is not imposable as the same could not have been more than the amount of duty i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009-10 is concerned, the same is not sustainable on account of the fact that the demand were raised solely on the basis of loose paper, and sheets without any independent evidence. The reliance was placed on the decision of this Tribunal in case of Arya Fibres Private Limited vs. Commissioner of Customs and Excise, Ahmedabad-II reported as 2014 (311) ELT 529 (Tri.-Ahmd), wherein it is held that clandestine removal is a serious charge which needs to be proved by the Revenue on production of sufficient and tangible evidences. Ld. Advocate placed reliance on the decision of Varun Enterprises vs. CCE ST [2019 (TIOL) 58 (Cestat-Del), wherein the demands were solely confirmed on the basis of diaries and loose papers recovered from the premises of assessee, were held to be unsustainable. The Department also failed to cause inquiry from raw material suppliers, transporter, excess use of electricity etc., to collect independent evidences. The case against the appellant has been made on the basis of assumption and presumption which is not sustainable in view of the decision of Jayant Extraction Indus Limited. vs ADC., Rajkot[2004(171) ELT 501 (Tri.-Mum). (iv) Ld. Adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of electricity far in excess of what is necessary for manufacture of goods otherwise manufactured and validly cleared on payment of duty; (g) statements of buyers with some details of illicit manufacture and clearance; (h) proof of actual transportation of goods, cleared without payment of duty; (i) links between the documents recovered during the search and activities being carried on in the factory of production; etc. 8. We also find that no investigation has been conducted by the Department for the forward and backward linkages of clandestine activities alleged to have been committed by the appellant. Same issue came up for consideration before Hon ble Allahabad High Court in Continental Cement Company(supra) . The relevant paragraph as reproduced as under; 12 . Further, unless there is clinching evidence of the nature of purchase of raw materials, use of electricity, sale of final products, clandestine removals, the mode and flow back of funds, demands cannot be confirmed solely on the basis of presumptions and assumptions. Clandestine removal is a serious charge against the manufacturer, which is require ..... X X X X Extracts X X X X X X X X Extracts X X X X
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