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2018 (9) TMI 1492 - AT - Central ExciseClandestine removal - Demand is based on copy of some documents received by the Central Excise Department from the Income Tax Department which had earlier conduced search and seizer operation in the premises of the appellant - Held that:- The main demand against the appellant-company is based on the private document i.e. Monthly Dispatch Summary Details (MDSD) recovered from the factory premises of the appellant. The said private documents i.e. MDSD has been alleged to have prepared by Shri Ramu Yadav and Shri R.K. Singh on the direction of the directors of the appellant-company for which department have relied upon the statement of Shri Ramu Yadav & Shri R.K. Singh. Cross-examination of witnesses - reliance to be placed on the statements of witnesses - Held that:- Request of cross-examination of Shri Ramu Yadav & Shri R.K. Singh was allowed by the learned Commissioner, but the Department was unable to produce their witness - It is well settled law that if the Department is not able to produce their witness for cross-examination, then the statement of that witness cannot be relied upon. Demand based on MDSD - Held that:- The said MDSD is not a genuine document as there is no corroborative or positive evidence available on record, showing clandestine removal of the goods. Therefore, demand on the basis of the said record-MDSD, is set aside. Demand on the basis of parallel invoices issued by appellant-company and resumed from the premises of Shri Mukul Jain, Commission Agent of fabric - Held that:- The department is mainly relying upon the statements of Shri Mukul Jain, to establish that the goods have been cleared on parallel invoices. The Department has not been able to produce Shri Mukul Jain for cross-examination during the adjudicating proceedings - there is no other concrete evidence available on record to prove that the appellant company has removed goods on the parallel invoices - demand set aside. Hon’ble High Court of Allahabad in the case of Continental Cement Company Vs Union of India [2014 (9) TMI 243 - ALLAHABAD HIGH COURT] have held that the Department has to bring on record corroborative evidence in the form of procurement of raw material, transportation, sale proceeds, buyers of such goods, capacity to manufacture, etc. - In the present case, there is no such positive or tangible evidence available. Since duty demand is set aside, penalties are liable to be set aside. The whole demand of revenue is based on the assumptions and presumptions, there being no corroborative evidence to support the allegation of suppression of production and/or clandestine removal - Appeal allowed - decided in favor of appellant.
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