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TMI Blog2025 (1) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... d the same is required to be discharged by production of positive evidences. Such a demand cannot be confirmed on assumptions and presumptions - This Tribunal in the case of Sharma Chemical Vs. CCE [ 2000 (12) TMI 161 - CEGAT, KOLKATA] has held that noting in the private records may raise suspicion but for confirming the charge of clandestine removal based on those records, there must be corroborative evidence in the form of installed capacity, raw material, utilization, labour employed, power consumed, goods actually manufactured and packed etc. Similar have been the findings of Hon ble High Court of Allahabad in their another decision titled as Commissioner of C.Ex., Meerut-I Vs. R.A. Castings Pvt. Ltd. [ 2010 (9) TMI 669 - ALLAHABAD HIGH COURT] holding that the income shown in balance sheets unless and until is linked to some other clinching evidence, cannot be the proof of clandestine removal of goods, has been upheld by Hon ble Apex Court in the case of Commissioner Vs. R.A. Castings Pvt. Ltd. [ 2011 (1) TMI 1302 - SC ORDER] . In light of this discussion, the department has failed to prove the allegations of clandestine removal of goods and noticed difference in the balance sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Shri Anju Kumar , Advocate for the Appellant Shri V J Saharan , Authorized Representative for the Respondent ORDER DR. RACHNA GUPTA Present appeal has been filed to assail Order-in-Appeal No. 04-2023-24 dated 11.04.2023. The factual matrix relevant for the impugned adjudication is that M/s. Indore Composite Pvt. Ltd., the appellant, is engaged in manufacturing of FRP Rods for Optical fiber cable and are availing the benefit of Cenvat Credit on inputs, input services and capital goods under Cenvat Credit Rules, 2004. During the scrutiny of appellant s record it was observed that the appellant cleared miscellaneous scrap (exempted goods) from their premises as evident from their balance sheet, however have not followed the provisions of Rule 6(3) of Cenvat Credit Rules, 2004. The department also observed while going through the scrap sale details in balance sheet of Financial Year 2016-17 and Trial Balance April -17 to June-17 that there is a difference in sale value of scrap as reported in balance sheet/trial balance and ER-1 filed by the appellant. The assessable value shown in the balance sheet was higher than the one reflected ER-1 resulting into the difference of Rs.61,47,001/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Service Tax reported as (2024) 17 Centax 245 (Tri.-Del) (iv) M.P. Audyogik Kendra Vikas Nigam (Indore) Ltd. Vs. Commissioner of Central Goods Service Tax and Central Excise, Indore reported as (2023) 8 Centax 219 (Tri.-Del) The Bangalore Bench of this Tribunal in the case of Synergy Audio Visual Workshop Pvt Ltd. Vs. Commissioner of S.T., Bangalore reported as 2008 (10) STR 578 (Tri.-Bang.)has also held that the balance sheet or other statutory returns cannot become basis for levy of tax. 3.1 It is further submitted that any demand of clandestine manufacture or clearance cannot be confirmed purely on assumption and presumption. The burden is upon the Revenue to prove the same by way of direct affirmative and in controversial evidence. Reliance has been placed upon the decision of this Tribunal in the case of Kutchh Steels Pvt. Ltd. Vs. CCE ST, Rajkot reported as 2023 SCC OnLine CESTAT 653. The allegation of clandestine removal of goods is also based on difference in sales figures in ER-1 and balance sheets. It is submitted that the said difference cannot be the basis. 3.2 Learned counsel further mentioned that the Chartered Accountant Certificate certifying the reconciliation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e CA certificate. Learned Departmental Representative has relied upon the decisionof this Tribunal in the case of CC (Export), Nhava Sheva Vs. SNS Overseas Pvt. Ltd. reported as 2012 (275) ELT 621 Tri. (Mum.), wherein it has been held that CA certificate cannot be the conclusive proof of the fact. 4.1 While submitting with respect to the invocation of extended period, it has been held that the difference as noticed in the balance sheet/trial balance and the ER-1 returns got noticed only at the time of audit of the appellant s records. Had there been no audit, the differential amount of service tax would have remained unpaid. Concealment of difference between the said two documents is sufficient to hold suppression of relevant facts by the appellant. Since it has resulted into evasion of part payment of service tax, there is no infirmity when extended period has been invoked while issuing the show cause notice. With these submissions, learned Departmental Representative has relied upon two other decisions i.e. in the case of Warsi Buildcon Vs. Principal Commissioner of Customs, Central Excise and Service Tax, Indore reported as 2024 (3) TMI 286 CESTAT New Delhi and the decision of H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther corroborative evidence vis- -vis the following aspects is relevant: (i) To find out the excess production details. (ii) To find out whether the excess raw materials have been purchased. (iii) To find out the dispatch particulars from the regular transporters. (iv) To find out the realization of sale proceeds. (v) To find out finished product receipt details from regular dealers/buyers. (vi) To find out the excess power consumptions Similar have been the findings of Hon ble High Court of Allahabad in their another decision titled as Commissioner of C.Ex., Meerut-I Vs. R.A. Castings Pvt. Ltd. reported as 2012 (26) STR 262 (All.)holding that the income shown in balance sheets unless and until is linked to some other clinching evidence, cannot be the proof of clandestine removal of goods, has been upheld by Hon ble Apex Court in the case of Commissioner Vs. R.A. Castings Pvt. Ltd. reported as 2011 (269) ELT A108 (SC). In light of this discussion, I hold that the department has failed to prove the allegations of clandestine removal of goods and noticed difference in the balance sheet compared with the ER-1 return is the presumptory basis of raising the said allegation. The finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax on the notional value taken by the appellant only for the purpose of accounting of the cost of the different units working under the appellants, will be not in the interest of the service tax law. Since, service tax has already been paid on the entire amounts which have been charged for transportation of the crude through pipeline, we think that charging service tax separately for the terminal facilities is legally not sustainable 7.3 The appellant on contrary has placed on record the certificate issued by his Chartered Accountant proving the reconciliation of both the statements but it is observed that CA certificate has not been considered by the department. This Tribunal vide Final Order No. A/11206/2023 dated 08.06.2023 in the case of Rajashree Polyfil Vs. Commissioner of Central Excise Service Tax reported as (2024)16 Centax 433 (Tri.-Ahmd) has held that the certificate issued by Chartered Accountant is alone a valid piece of evidence even without corroboration. It can be treated as expert evidence for the reason that Institute of Chartered Accountant of India, a statutory body instituted by the Government of India, has recognized the Chartered Accountant to be competent to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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