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2016 (10) TMI 475 - CESTAT, CHANDIGARHClandestine manufacture and clearance of excisable goods - investigation - Whether the panchnama drawn during the course of investigation can be relied upon and photocopies of the documents are admissible in the absence of original documents? - Held that: - the photocopies of the documents which are not available in original has been relied on by the revenue is not admissible evidence - the decision of the Apex Court in the case of J.Yashoda vs. Shobha Rani [2007 (4) TMI 11 - SUPREME COURT OF INDIA] relied upon - panchnama and the photocopies of the documents are not admissible evidence. Clubbing of clearances - Whether the clearances made by the respondents, namely, M/s.Dirba Pipes Pvt. Ltd., M/s,North India Pipes Pvt. Ltd., M/s.M.A. Pipes Pvt. Ltd. and M/s.Garg Pipes Pvt. Ltd. can be clubbed together and the benefit of SSI exemption can be denied and duty can be demanded? - organisational structure gone through - Held that: - on organisational structure, it cannot be held that all the units are controlled by one person - decision in the case of M/s. Nova Industries (P) Ltd. Versus CCE- Chandigarh [2015 (5) TMI 99 - CESTAT NEW DELHI] relied uponwhere it was held that all the units are having separate machinery, separate registration number and dealing separately.There is no financial flow back and there is no mutuality of interest between the units. Therefore, all the four units cannot be clubbed together - issue answered in favoe of respondents. Clandestine removal of goods - Held that: - in cases of clandestine manufacture and clearances, certain fundamental criteria have to be established by Revenue which mainly are the following : (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 production; etc. Any of the charges mentioned above not proved, hence, the charge of clandestine removal of goods is not sustainable against the respondents. The quantity and value of clearance in respect of each of the manufacturing unit is required to be identified and duty liability is to be determined. No effort has been made to quantify the value and quantity of ERW pipes cleared by each units. Therefore, without ascertaining of value of the goods cleared clandestinely, the demand is not sustainable - issue answered in favor of respondents. The original documents were not available with revenue. No efforts were made to trace the documents, no official was held liable for the said discrepancy which shows the negligent attitude of the investigating agency. Appeal dismissed - decided against Revenue.
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