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TMI Blog2019 (12) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of power was also not taken into consideration. The retrieval of data by Government Examiner of questioned documents only establishes that such data was maintained by M/s KIL - such maintenance of data by representative of M/s KIL does not establish actual payment by the appellant. No evidence of actual payment has been brought on record by revenue. The manufacture of such quantity of goods on which Central Excise duty of around ₹ 5.5 crores was demanded is not established - Since Central Excise duty is on manufacture and manufacture is not established, therefore, there is no basis for demand of Central Excise duty to the tune of ₹ 5,58,89,762/- - Since the demand is not sustainable the penalty is on the appellants are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same to M/s KIL after the end of month on the basis of total quantity of goods manufactured by them for which such trademark was used. On 12.11.2008 several premises belonging to M/s KIL were searched by the officers of DGCEI. One of the premises searched by them was at J-1200, Palam Vihar, Gurgaon. At the said premises certain Pen-drives, Computers and Laptops were recovered by the officers. The said recovered electronic devices were got examined through Government Examiner of questioned documents. On the basis of data retrieved by the Government Examiner of questioned documents, the officers of Central Excise Intelligence came to know that said data also had reversed the royalty charges recovered by M/s KIL from the franchisee users ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... April, 2008 to September, 2008. Therefore, through show cause notice dated 03.05.2013 a demand of Central Excise duty of around ₹ 5.5 crores was raised against the appellant with proposal to impose penalties on the other two appellants. The proposal for imposition of penalty on the other two appellants was through invocation of Rule 26 of Central Excise Rules, 2002. On contest, the said show cause notice was adjudicated through the impugned Order-in-Original wherein the Original Adjudicating Authority has confirmed the demand of Central Excise duty amounting to ₹ 5,58,89,762/- and has imposed equal penalty on the appellant. Further, under the provisions of Rule 26 of Central Excise Rules, 2002 he imposed penalty of ₹ 50 l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.05.2010 both Shri Jagdish Prasad, Manager and Shri Deepak Maheswari, Accountant clearly stated that during the period from April, 2008 to September, 2008 payments were made to M/s KIL only through cheques and no cash payments were made and the payments made through cheques tallied with the books of account and therefore, the demand raised on the basis of third party evidence were without any corroboration and therefore, the same is not sustainable. She further submitted that there is no evidence adduced by the department to show that the appellant had received unaccounted raw material or consumed more electricity to produced and cleared the alleged huge quantity of impugned goods as mentioned in para no.19 of show cause notice. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri Suneel Kumar Agarwal disserves to be set aside. 5. Heard the learned Addition Commissioner Shri Rajeev Ranjan Authorised Representative appearing on behalf of revenue. He has supported the impugned order. 6. Having considered the submissions from both the sides and on perusal of record, we note that fundamental argument is on account of absence of any evidence about the alleged manufacture of goods on which Central Excise duty is demanded. Learned Counsel for the appellant has submitted that there was no inquiry made by Revenue regarding the alleged production and sale of the goods and realization of sale proceed thereof and non-identification of customers and there was absence of any evidence about cland ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 required to be discharged by the Revenue by production of sufficient and tangible evidence. On careful examination, it is found that with regard to alleged removals, the department has not investigated the following aspects : (i) To find out the excess production details. (ii) To find out whether the excess raw materials have been purchased. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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