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TMI Blog2023 (8) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner, it goes without saying that (i) some of the duty demand were mistakenly made on the goods traded by the Appellant; (ii) duty was also demanded on Monitors, Key-Boards, other peripherals and data security packages; (iii) alongwith the computer system, duty was also charged on the printers though those where accessories; (iv) his ultimate observation is that confirmation of demand would require necessary scrutinisation of each invoices mentioned in the show-cause notice; (v) confirming demand solely on the basis of statement of witnesses would be inconsistent with the principle of natural justice. Going by the evidentiary value of the statement of witnesses concerning their silence during evidence, if could amount to admission, the settled position of law is that such silence can be treated as acceptance in favour of a defence primarily made under the Laws of Contract but not against a third person and can never be taken as admission of proof of guilty of another person. Furthermore, as could be observed from the Order-in-Original, denial of witness Amit Patel concerning any second sale being made by the Appellant, it can be said that the Order-in-Original is silent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he companies under Rule 209A of Central Excise Rules, 1944 by the Commissioner, Central Excise, Mumbai-I is assailed in this appeal. 2. Fact of the case, in a nutshell, is that Appellants were engaged in the business of development and marketing of packaged softwares and also they were trading in peripheral/parts of computers system. To develop packaged software and to carry out in house research and development, the Appellants had purchased computer systems for in house use and software development purposes. They assembled computer systems in house but not traded those hardwares. During search conducted in January 1995 in Midpoint Software Company, several documents of the Appellants were taken up by the respondent department and were never returned back to the appellants despite several requests made in writing to the concerned Assistant Commissioner. Ultimately show cause notice dated 13.7.1995 was issued to the Appellants with proposal for recovery of duty and penalty. Common show cause notice dated 22.12.1995 was issued to these Appellants with another M/s.Compac Computer demanding above referred duty and penalty on the Appellants that could not be contested by the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss Electronics Industries, 2015 (323) ELT 241 (S.C.), he argued that it would be trite of law that allegation based purely on statements of witnesses without corroboration with documentary evidence to support such statements cannot be said to have established the allegations for which the demands are liable to be set aside and the Commissioner had perhaps for this apparent reason, dropped the entire demands against M/s. Compac Computer, another assessee in this proceeding since documentary evidence were not available but erroneously had confirmed the demands against these appellants by accepting few available documents, which were otherwise favouring the appellants. 4. To elaborate the same, learned Counsel also had drawn attention of this Bench to para 49 of the Commissioner s order vis- vis the seized documents to justify those documents were nothing but few invoices issued to different parties through which components of computers were sold together but such invoices clearly indicated that those computers were subjected to second sale that would justify the Appellant s stand that those were old computer peripherals. 5. Learned Counsel for the appellants further submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... introduced for the first time in 1996, its retrospective application on the Appellants from 1996 is unsupported by provisions of such Statue for which the entire order of confirmation of demand and penalty including order for realisation of interest is liable to be set aside. 7. In response to such submissions, learned Authorised Representative Shri P.K.Acharya submitted that in the second round of adjudication, due importance was given to the non-availability of documents by the adjudicating authority and only on the basis of documents which were supplied to the Appellants vide letter dated 7.5.2008 were taken into consideration to confirm only a portion of demand. He further submitted that there is plethora of case law referred in the field that cross examination is not mandatory and confessional statement recorded would be sufficient to confirm the demand and in the instant case not only suppliers have deposed in their statements that they had supplied computer parts and not the entire system that has also been confirmed by Shri Amit Patel, Hardware Engineer, who stated to have been engaged in assembling computers alongwith 3 other Hardware Engineers employed by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it is not consistent with principle of natural justice to confirm any demand based only on the statements recorded. So I do not propose to deal with replies given by Compac . I have to only deal with the replies given by MSESL and FGESPL. 9. On close scrutiny of the above observation made by the Commissioner, it goes without saying that (i) some of the duty demand were mistakenly made on the goods traded by the Appellant; (ii) duty was also demanded on Monitors, Key-Boards, other peripherals and data security packages; (iii) alongwith the computer system, duty was also charged on the printers though those where accessories; (iv) his ultimate observation is that confirmation of demand would require necessary scrutinisation of each invoices mentioned in the show-cause notice; (v) confirming demand solely on the basis of statement of witnesses would be inconsistent with the principle of natural justice. After making these observations, he noted that as because documents relating to M/s. Compac Computers was not available, no demand could be confirmed against it, for which he restrained to himself from analysing the replies given by M/s. Compac Computers. 10. Learned Counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, it would also be erroneous to accept the argument of the learned AR that at some point of time, those documents were available for which their existence and evidentiary value could not be discarded in unacceptable proposition. I am, therefore, of the considered view that the proposition available in the findings of Commissioner in absolving M/s Compac Computers from its liability would squarely made applied to the present Appellants for the reason that from the invoices copy supplied to the Appellant, that form part of the record, no sale of new computers are noticeable, to justify taxability against them. Further, it would not be out of place to record that even if taxability would have been justified, direction for payment of interest on the duty demand that was made much prior to the introduction of Section 11AB in 1996 is hit by its sub-Section 2, as was available then and also the same would be contrary to the judicial precedent set by the Tribunal and by various High Courts including in the case of Shri Ukai Pradesh Sahkari Khand Udyog Mandli Ltd. Vs. CCE, Surat reported in 2009 (247) ELT 184 (Tri.-Ahmd.) that has received affirmation by the Hon'ble High Court of Guja ..... X X X X Extracts X X X X X X X X Extracts X X X X
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