TMI Blog2019 (1) TMI 245X X X X Extracts X X X X X X X X Extracts X X X X ..... thing more is required to prove. It is well settled law that only on the basis of statements, huge demand cannot be confirmed, especially when statements have been retracted and no cross-examination has been given of the witnesses. The appellant have led cogent evidence being bill for acquisition of furnace in recent, furnace past contract given for its installation, etc. Such evidence was not found untrue. Further as per the panchnama, the furnace was under installation. No supporting raw material, moulds, labour etc was found, essential for manufacture of ingots. No ascertainment of furnace capacity by an expert was done. In the inspection by officers of Municipal Corporation of Delhi, in the near vicinity of date of panchnama, no manufacturing activity was found. The Calculation of purchase of copper scrap have also been included. The whole case of Revenue is based on assumption and presumption on unreliable evidences - appeal allowed - decided in favor of appellant. - Excise Appeals Nos.50610-50612/2015 - Final Order Nos.50014-50016/2019 - Dated:- 3-1-2019 - MR. ANIL CHOUDHARY, MEMBER (JUDICIAL) And MR. C.L. MAHAR, MEMBER (TECHNICAL) Shri Kamaljeet Singh, Advocat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of Smt. Manisha Goyal, Wife of Shri Sanjay Goyal was recorded by the officers of central excise, same day. The officers have also searched the residence of Shri Vijay Kumar Goyal, C-87, Antarisksha Apartments, Sector-14, Rohini, New Delhi, wherein they have recovered resumed one laptop and one pen-drive. The officers have also recorded inculpatry statement of Shri Vijay Kumar Goyal on 5.10.2012. The department also searched the premises at C-56, First Floor, Rohit Kunj, Pitampura, Near Rani Bagh, New Delhi, wherein they resumed one CPU, a Fujitsu Siemens branded laptop and certain loose papers. The officers have also recorded statement of Shri Dinesh Goyal on 5.10.2012. In furtherance of these investigations, the department had also visited the premises of 3 buyers of copper ingots on 6.10.2012, as named by Vijay Kumar Goyal in his statement. 3. The officers of Central Excise searched the premises of Shri Shivam Electronic Pvt. Ltd., Khasra NO.38/20, Village Mundka, Delhi, wherein Shri Kailash Choudhary, Director has stated that they have not purchased any copper ingots from M/s. Rama Industries. The officers have also searched the premises of M/s. Kaycee Electricals, B-7, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2012, the furnace was still under installation and the area around the furnace was being levelled and repaired as can be seen from the panchnama. 6.4. That the appellant s attendance register was also resumed during the search has not been relied upon in the show cause notice. This register is for around one and a half months prior to date of search and shows that during this period, the appellant had only two to five employees on its rolls which conclusively establishes that no manufacturing activity was being carried out by the appellant. 6.5. That as per page 3 of the panchnama the officers have resumed a Digital Video Recorder installed in the office room of the appellant in which recording of manufacturing activity was being carried out. The DVR recording clearly shows that the appellant was not carrying out any manufacturing activity. 6.6. That the premises of the appellant is agricultural land. It is shown as godown premises in the electricity bills and in the rent agreement with landlord. After search on 05.10.2012, officers of the Municipal Corporation of Delhi also raided the appellant s premises issued challan stating that premises is a godown. No manufacturi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of copper ingots manufactured by the appellant but are regarding the trading of ingots and scrap by Sh. Sanjay Goyal. 6.15 That no reliance can be placed on the spiral notebook recovered from the residential premises of Sh. Vijay Kumar Goyal. The statement of Sh. Vijay Kumar Goyal stating that this notebook contains details of transactions of the appellant Rama Industries is false and has been written as per the wishes of the investigating officers only to buy peace with the Department. Sh. Vijay Kumar Goyal has no relation with the appellant firm and this notebook does not contain any details pertaining to the transactions of the appellant. Moreover, it is well settled by, inter alia, the following judgments that demand of duty on the basis of documents recovered from third party is not sustainable : CCE, Raipur Vs. P.D. Industries Pvt. Ltd. 2016 (3400 ELT 249 (Trib. Delhi) -Karnavati Synthetics Ltd. Vs. CCE 2014 (304) ELT 696 (Trib.) -Sakeen Alloys Pvt. Ltd. Vs. CCE 2013 (296) ELT 392 (CESTAT), 2013 (308) ELT 655 (Guj.), 2015 (319) ELT A117 (SC) -K.V. Textiles Pvt. Ltd. Vs. CCE 2009 (240) ELT 397 (CESTAT) -CCE Vs. Chola Spinning Mills (P) Ltd. 2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ELT 254 (CESTAT) 6.21. That the calculation of the duty demanded is contained in the chart at para 16 of the show cause notice. The first five entries of this table are on the basis of Annexure B to the show cause notice and show sale of 161789 kgs of copper ingots involving duty of RS.77,10,255/-. The last four entries are on the basis of the contents of the spiral note books and show sale of 941029 kgs of copper ingots involving duty of ₹ 5,32,86,044/-. 6.22. As per the said Annexure B, the appellant has allegedly procured 170303.50 kg. of copper scrap and manufactured 161788.32 kgs of copper ingots from this scrap (ratio of scrap : ingots :: 100:95). This annexure has a note at the end stating that while preparing this annexure, the loose parchies showing purchase of other items like PVC have not been taken. 6.23. However, a perusal of the loose slips establishes that a large number of these loose papers which have been taken in Annexure`B are for purchase of pipe, telephone wire PVC wire, plastic etc.. The chart and photocopies of loose slips annexed with the appeal show that even in respect of the loose papers which have been taken into consideration for pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g carried out. One furnace was lying uninstalled. One furnace was in the process of being installed. No stock of copper ingots was found. No moulds, bamboo and charcoal for manufacturing copper ingots were available in the premises. The stock of raw material was only 2400 kgs. The capacity of the furnace is alleged to be 4 MT. Thus the stock-in-hand was not sufficient even for one heat. Moreover, no workers were present in the premises. The only labour found in the factory was carrying out construction /repairs around the furnace. No statements of any of these labourers were recorded. The officers have not seized any stock of ingots in the unit of the appellant or during the course of their transit from the appellant s unit to any other premises or in the premises of any alleged purchaser of the appellant. No enquiry has been made from any transporters who have transported scrap to the premises of the appellant or ingots from the premises of the appellant. No enquiry has been conducted from any scrap dealer. Not even a single purchaser of ingots has accepted having received goods from the appellant, nor has been identified. The three buyers of copper ingots named by Sh. Vijay Kumar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lips) recovered from the premises of Shri Sanjay Goyal. The said records have been disputed by the appellant by showing various infirmities in their reply during the course of argument. We further find that there are names of suppliers buyers mentioned in the said records, however, during the course of investigation of the named buyers by the Revenue, the said buyers have denied to have purchased any goods from the appellant. The Revenue has not been able to identify any buyer of the said goods. We also find that no investigation has been conducted as regards supplier of raw materials to the appellant. WE find that the Hon ble Allahabad in the case of Continental Cement Company Vs. UOI 2014 (309) ELT 411 (Allahabad) has laid down various parameters to establish clandestine removal of goods. However, in the present case, no such evidence has come on record. The ld. AR is mainly relying on the statement of various persons to conclude that clandestine removal of goods have been established and nothing more is required to prove. We find that it is well settled law that only on the basis of statements, huge demand cannot be confirmed, especially when statements have been retract ..... X X X X Extracts X X X X X X X X Extracts X X X X
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