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2009 (12) TMI 838 - CESTAT BANGALOREClandestine manufacture and removal - entire case of the Revenue is built on the statements furnished of Shri Hanumantha Rao by the assessee to the bank which had advanced credit to it - Held that:- During the cross-examination of Shri Hanumantha Rao, when questions were asked about excess granules of 88.76 MTs as indicated in the annexure to the show cause notice, he had wanted to see the monthly particulars. On perusing the statements furnished to bank, he submitted that during the material time he was not in the branch of the bank. In the circumstances, the assessee’s plea that the statements of Shri Hanumantha Rao could not have been relied on to find clandestine clearances by the assessee carries considerable force. In a larger number of decisions passed by this Tribunal, it was held that clandestine clearance cannot be found without cogent and tangible evidence - In the instant case, Commissioner relied on bank statements, the correctness of particulars contained in which was disputed and not corroborated by any other evidence. The Commissioner has not been able to effectively rebut the claim of the assessee that it had not manufactured sacks in the absence of machinery, yet proceeded to confirm the demand finding that the assessee had been registered for manufacture of sacks - the authorities have not investigated the allegations against VPSL and gathered any evidence. The allegations raised in the show cause notice were not backed by any reliable or positive evidence. The notice was issued without finding a proper prima facie case against VPSL - demand set aside - appeal allowed.
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