9911796707
TMI Blog2024 (12) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusions to be drawn are necessarily to be logical and not on the basis of presumptions and assumptions. Suspicion, howsoever grave, cannot replace the test of proof. The mere fact that the respondent agreed to deposit the duty amount to avoid any kind of litigation, itself cannot be held to be the basis for confirming the duty demand against the respondent. CESTAT found that the case of unaccounted manufacture and clearance was built upon only sketchy evidence without concrete corroboration and whatever evidences formed basis for the case of Revenue, fell short of the minimum requirement of credible case of clandestine removal - the CESTAT conducted a meticulous exercise to examine and appreciate the evidence on record in the light of settled principles and came to a categoric finding that the case of unaccounted manufacture and clearance was built on sketchy evidence without any concrete corroboration and whatever evidence formed basis of the case of the Revenue fell short of the minimum requirement of credible case of clandestine removal. In the absence of any tangible evidence which would indicate that there was clandestine manufacture and clearance of the goods from the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had been receiving substantial quantity of copper scrap without any bills/documents and was not entering the details of sale in the statutory records, that the scrap was used for manufacturing ingots and cleared to various parties after drying into wire rods on job-work basis without being accounted in any statutory records and without payment of duty. The assessee was alleged to have cleared 3,62,515.90 Kgs of copper wire. It was further alleged that 19,52,267 Kgs of ingots/wire bars appear to have been manufactured as per Bhatti register and were cleared without payment of duty, and that 3500 Kgs of scrap allegedly found short during the search was admitted to have been cleared after converting it into ingots and then to wire rods, that electricity facility was manipulated/tampered with to accommodate recorded production. Demand of duty and education CESS of Rs. 1,21,42,057/- was raised on alleged clearance of copper wire rod and Rs. 2,93,17,554/- on alleged clearance of copper ingots without payment of duty and of Rs. 62,832/- on the alleged shortage of copper scrap. 5. Both the above two SCNs were originally adjudicated vide Order in Original dated 30.03.2009 upholdin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the evidence regarding realization of sale proceeds of clandestine removal of goods being available in the form of recovery of sale proceeds amounting to Rs. 6.2 lacs in cash from the residential premises of Sh. Rajender Prasad, father of Sh. Vinod Gupta, proprietor of M/s. ASPN during search on 21.09.2005. Sh. Rajender Gupta, who was present during search, had failed to explain the source from which it was acquired. It is thus argued that CESTAT has completely erred in allowing the appeal filed by the respondent and rejecting the appeal filed by the appellant department. 11. On behalf of respondent, it has been argued that Revenue has failed to prove the allegations and consequently the demand of dues and penalty. It has been submitted that the statements recorded under Section 14 of the Act were not voluntary. The statements were later retracted by the witnesses, and therefore, prudence demands that such retracted statements should not be accepted without independent corroboration. It is also argued that the recovered documents do not pertain to the respondent and there is no tangible evidence of clandestine removal of the goods or other evidence. According to the learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... visual survey and not by actual weighment. The Original authority recorded that since the authorized representative has signed the Panchnama admitting the shortage, the stock verification cannot be questioned. However, it is not clear as to whether actually a physical weighment has been made of the stock of raw-material. Admission of the authorized representative by signing the Panchnama is the sole reason recorded by the original authority to uphold the shortage of raw-material. Even considering that there is such shortage, that cannot be automatically converted into a charge of un-accounted manufacture and clearance of excisable final product. 16. The mode of verification i.e. by eye estimation, if true, is no verification and no demand can be based on such eye estimation. 17. Revenue had placed strong reliance on the documents and statements of Sh. Girish Chand and Sh. Devender Kumar Sharma, stated to be the employees of the respondent-assessee. CESTAT found that Sh. Girish Chand was a labour contractor, supplying labourers to the assessee. He used to supply labourers to his various other clients also. Sh. Devender Kumar Sharma is a dealer of copper items and scrap. Assessee cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tractions without any evidence from which it can be inferred that there was any threat, coercion or inducement used in recording the same. I am unable to agree with this proposition. It is contrary to the law laid down by the Hon'ble Supreme Court in Vinod Solanki vs Union of India, 2009 (233) ELT 157 (SC), wherein while considering various judgments of the Hon'ble Supreme Court, on which reliance has been placed by Revenue, it was held that- 34 ............... Law does not say that the accused has to prove that retraction of confession made by him was because of threat, coercion, etc. but the requirement is that it may appear to the court as such. 35 ............ It is one thing to say that a retracted confession is used as a corroborative piece of evidence to record a finding of guilt but it is another thing to say that such a finding is arrived at only on the basis of such confession although retracted at a later stage. 37 ............. The inference that burden of proof that he had made those statements under threat and coercion was solely on the proceedee does not rest on any legal principle. The question of the appellant's failure to discharge the burden would ari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2014 (311) ELT 529 (Tri.-Ahmd.), the learned CESTAT discussed the entire law concerning clandestine removal and enumerated the legal position as under: (i) There should be tangible evidence of clandestine manufacture and clearance and not merely inferences or unwarranted assumptions; (ii) Evidence in support thereof should be of: (a) raw materials, in excess of that contained as per the statutory records; (b) instances of actual removal of unaccounted finished goods (not inferential or assumed) from the factory without payment of duty; (c) discovery of such finished goods outside the factory; (d) instances of sale of such goods to identified parties; (e) receipt of sale proceeds, whether by cheque or by cash, of such goods by the manufacturers or persons authorized by him; (f) use 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
