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TMI Blog2023 (9) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... been rendered by this Tribunal on the same allegations and the demands have been dropped. The issue involved in the present appeals is no more res-integra as this Tribunal as well as the Tribunal at Allahabad has consistently set-aside the demands by considering all the evidences produced before them. The impugned order passed without affording an opportunity of cross examining the witnesses in spite of the request made by the appellant for cross examination of the witnesses and in the absence of cross examination, their statements cannot be relied upon as held by the Hon ble Punjab and Haryana High Court in the case of M/S JINDAL DRUGS PVT. LTD. AND ANOTHER VERSUS UNION OF INDIA AND ANOTHER [ 2016 (6) TMI 956 - PUNJAB HARYANA HIGH COURT] . The impugned order is not sustainable in law - Appeal allowed. - HON BLE Mr. S. S. GARG, MEMBER (JUDICIAL) And HON BLE Mr. P. ANJANI KUMAR, MEMBER (TECHNICAL) Shri Vikrant Kackaria, Advocate for the Appellant Shri Aneesh Dewan, Shri Narinder Singh, Authorised Representatives for the Respondent ORDER Per : S. S. GARG The present appeals are directed against the impugned order dated 24.06.2016 passed by the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de order-in-original no. 108-118/CE/CHD- 11/2016 dated 24.06.2016 confirmed the demand of Rs.1,94,93,730/- on the grounds that the evidences gathered by the department during the investigations was enough to prove that the appellants indulged in non manufacturing, fabrication of the manufacturing records and issuing the bogus invoices without actual production and clearance of the goods with intent to avail inadmissible refund/self credit of duty paid through account current (PLA) fraudulently and facilitated availment of input credit by buyers of said bogus invoices. The demand relates to that amount, penalty of equivalent amount was imposed on the appellants under Section 11AC of the Central Excise Act, 1944. Penalties under Rule 26(2) of the Central Excise Rules, 2002 were also imposed on the suppliers who have abetted in making false documents on the basis of the which the appellants and the buyers have taken ineligible benefits fraudulently. 4. Hence, the present appeals. 5. Heard both the parties and perused the records. 6. Ld. Counsel for the appellants submits that the only issue involved in the present appeals relates to demand of Central Excise duty on the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... la vide order dated 14.09.2021. He further submitted that since the issue has already been attained finality in the High Court and hence the demand does not merit to sustain. He further submitted that the department has not produced even a single decision in respect of the same investigation where the demand has been confirmed by any of the Appellate Authorities. He further submitted that the allegations of the department that there is no evidence of alternative source of generation of electricity is factually incorrect as only an allegation has been made that the said area does not have any electricity for 8-10 hours in a day. No evidence whatsoever has been produced by the department either in the show cause notice or the impugned order to show that even the electricity was disconnected even for hour during the relevant period. Merely stating that the area does not have electricity without any evidence has no legs to stand and in the absence of such an evidence no demand can be confirmed against the appellant. He further submitted that the appellant had produced the evidence that consignment had crossed the Toll Post at Lakhanpur and produced the copies of the same but the same h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PBC Checks/verification of plant/machineries and reported nothing adverse against these units. 6. Therefore, it may not be strongly alleged with certainty that during the period 2005-2006 to 2008-2009, these 27 units have not purchased crude Mentha oil and therefore have not manufactured any Menthol products in their units at all. There is hardly any time left for further investigation to strengthen the case as process is very time consuming and most of these of units have closed their factories due to withdrawal of Central Excise Duty on all Mentha products w.e.f 27.02.2010Thus, the investigation may not be in tune with the investigations conducted by the Central Excise Commissionerate Merrut-II. He further submitted that no evidence has been produced by the department to the effect that the said goods were not supplied to the buyers who have availed the credit. No statements of transporters have been recorded. He further submitted that even otherwise the refunds were sanctioned vide various orders by the Adjudicating Authority and the said orders have not been challenged by the department till date and in the absence of challenge to the refund orders which were an appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the parties and perusal of material on record, we find that as per the allegation in the show cause notice, the investigation were undertaken by the Merrut Commissionerte and it was found that the suppliers of raw- material to the appellant were non-existent. Further, we find that the demands have been confirmed only on the basis that there was no alternative source of electricity generation which is factually incorrect. Further, we find that on the basis of the same investigation, the demands were confirmed against many parties and some of the decisions have been rendered by this Tribunal on the same allegations and the demands have been dropped. The issue involved in the present appeals is no more res-integra as this Tribunal as well as the Tribunal at Allahabad has consistently set-aside the demands by considering all the evidences produced before them. We also find that in one of the cases, the department filed appeal before the Hon ble Allahabad High Court and the same was dismissed as cited (supra). 9. Further, we also find that the department has not been able to produce even a single decision arising from the same investigation where the demand has been confirmed by a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, it cannot be held that the appellants were not manufactured the goods during the impugned period. Moreover, as per the report of Jurisdictional Commissioner to Chief Commissioner dated 21.05.2010 reveals as under: 5. Thus the officers of Merrut-II Commissionerate, instead of selecting the consignments where no excisable goods were manufactured/supplied, have generalized that all the purchases of crude Mentha oil by these Mentha units located at Jammu were bogus units, these units did not have any infrastructure to manufacture the said products, were nonfunctional and Transporters who did not tum up for tendering statements were declared non-existent etc. however, on close scrutiny of the records, the following facts emerges: (i) Most of the consignments of raw material were found entered at the Toll barrier. (ii) The Officers of District Industry Centre, who have assessed and fixed the capacity of manufacturing units, have been regularly verifying their purchase consignments. (iii) The Range staff had also been visiting these units for PBC Checks/verification of plant/machineries and reported nothing adverse against these units. 6. Therefore, it may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation conducted at the end of Commissioner of Central Excise, Merrut is not sustainable that the appellant is not manufacturer the goods. Admittedly, duty is payable on the manufacture of goods and as per the report of the Commissioner of Central Excise, Jammu dated 25.02.2010, it has been revealed as under: 5. Thus the officers of Merrut-II Commissionerate, instead of selecting the consignments where no excisable goods were manufactured/supplied, have generalized that all the purchases of crude Mentha oil by these Mentha units located at Jammu were bogus units, these units did not have any infrastructure to manufacture the said products, were non-functional and Transporters who did not tum up for tendering statements were declared non-existent etc. however, on close scrutiny of the records, the following facts emerges: (i) Most of the consignments of raw material were found entered at the Toll barrier. (ii) The Officers of District Industry Centre, who have assessed and fixed the capacity of manufacturing units, have been regularly verifying their purchase consignments. (iii) The Range staff had also been visiting these units for PBC Checks/verification of pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant inthe form of Order-in-Original passed by Commissioner of Central Excise, Jammu on 31/03/2008, wherein it was held that M/s Infotech System, Jammu was manufacturing the goods was not accepted by the Original Authority stating that the said Commissioner, Jammu did not see himself that the goods have been manufactured. If such a logic is accepted then the basic system of assessment by Authorities under tax statute needs to be concluded to have been not properly understood by the Adjudicating Authority. The present system of assessment in Central Excise is record based. The Officer assessing the duty is not required to be present when the goods are being manufactured to witness the process of manufacture. The adjudication is to be done on the basis of evidence produced before the Adjudicating Authority. As per Evidence Act evidence in totality is to be taken into consideration and therefore, finding recorded in the impugned Order by the Original Authority who passed the said Order dated 29/01/2010 is bad in law. The Original Authority did not understand the process either of assessments or of adjudication. Further the investigations were not undertaken to find out wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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