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TMI Blog2024 (10) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... inished products viz. Copper wire/ bare Copper wire without payment of Central Excise Duty. Therefore, simultaneous searches were conducted on 10.11.2009 at the premises of appellants, transporters. Relevant documents/records were placed under seizure. During the search and on scrutiny of the records, statements of representatives of M/s Shivani and its associates are recorded. From the investigation, it appears that Appellant had cleared their finished goods illicitly without payment of duty of Rs. 1,46,85,771/- which were transported by several transporter. Further during the course of search at factory premises of Appellant, shortage of finished goods/ semi -finished goods of Rs. 2305.430 Kgs. were found. Shri Bhupendra Govind Patel, Factory Manager admitted the clearances of said goods. The duty liability on the said shortage goods of Rs. 60,789/- workout by the revenue. 1.2 After the detail investigation a show cause notice dated 24.12.2012 was issued to Appellants proposing the demand of Central Excise Duty of Rs. 1,46,85,771/- on account of clearances of finished goods without payment of duty and duty demand of Rs, 60,789/- on shortage found goods quantity 2305.430 Kgs. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2014(302)ELT 69 (Tri. Ahmd.) which was affirmed by Hon'ble Gujarat High Court - Commissioner Vs. Motabhi Iron & Steel Industries -2015(316)ELT 374 (Guj), he also argued that statements of the transporter not corroborated with any other evidences thus demand cannot be confirmed on the basis of the third party statements. 2.3 Without prejudice, he also submits that demand of central excise duty has been arrived by the department against M/s Shivani Metals by relying upon the documents pertaining to M/s. Somain Enterprises as the Ld. Commissioner, Vapi does not have the jurisdiction to make the demand against M/s. Somain Enterprises, therefore demand has been frivolously made against the Appellant which is liable to be set aside. 2.4 As regard the demand of central excise duty of Rs. 60,789/- he submits that revenue worked out the said duty liability on the goods 2305.430 Kg. found short during the search on the ground that Shri Bhupendra G Patel accepted the clearances of the said goods. However, in the present matter cross-examination of Shri Bhupendra Patel was not allowed by the Ld. Commissioner, hence by relying the statement of said person no demand is sustainable. 2.5 He f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een relied upon has been turned down on the ground that after recording the statements nobody retracted the statements thereafter, there is therefore a reason to believe that the statements have been given voluntarily, without any pressure. In this regard, we find that the reasons assigned by the authorities below to reject cross-examination is clearly unsustainable in legal parlance for the obvious reason that no adverse inference can be drawn against assessee whose statements are to be relied by the Revenue without ascertaining the veracity in the absence of cross-examination. Therefore the said statements cannot be relied upon as admissible evidence in terms of the provisions of Section 9D of the Act. The provisions of Section 9D which are reproduced as under : - "9D. Relevancy of statements under certain circumstances. - (1) A statement made and signed by a person before any Central Excise Officer of a gazetted rank during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains, - (a) when the person who made the statement is dead or canno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to in cross-examination; and if new matter is, by permission of the Court, introduced in re-examination, the adverse party may further cross-examine upon that matter." 9. It would, thus be seen that Section 138 (supra) envisages that a witness would first be examined-in-chief and then subjected to cross-examination and for seeking any clarification, the witness may be re-examined by prosecution. There is, in our opinion, no meaning in tendering a witness for cross-examination only. Tendering of a witness for cross-examination, as a matter of fact, amounts to giving up of the witness by prosecution as it does not choose to examine him in chief. However, the practice of tendering witness for cross-examination in session trials had been frequently resorted to since the enactment of the Code of Criminal Procedure, 1898." In view of above it is clear that in adjudication, the adjudicating authority is required to first examine the witness in chief and also to form an opinion that having regard to the facts and circumstances of the case, the statements of the witness are admissible in evidence. Thereafter, the witness is offered to be cross-examined. We find that in the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ateria to Section 138B of the Customs Act, 1962) must examine the witnesses whose statements have been relied upon by the Department. A finding of clandestine removal of goods on the basis of uncorroborated statements was not sustainable in the absence of positive evidence of purchase of unaccounted raw materials, use of excess electricity, admission of raw material supplier with corroborative evidences etc. In this case, no documents indicating suppression of purchase of raw material or of production of finished goods was recovered, no data related to excess electricity was found by the department, no seizure or recovery of any duplicate or fake purchase invoices or delivery challans was made and no physical movement of goods without proper invoices or without payment of duty was noticed for the period of dispute. The adjudicating authority found clandestine removal of goods merely on the basis of uncorroborated statements and, therefore, the finding was not sustainable. 4.4 We also find that the allegation against the appellant in present matter is that they have procured unaccounted raw materials and cleared illicitly the clandestine manufactured finished goods without payment ..... X X X X Extracts X X X X X X X X Extracts X X X X
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