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2023 (9) TMI 722 - CESTAT AHMEDABAD
Under-valuation - demand based on excel computer printouts - admissibility of computer printouts as evidences or not - Section 36B of the Central Excise Act as made applicable for service tax law by virtue of Section 83 of the Finance Act, 1994 has not been followed - admissibility of statements - HELD THAT:- Apart from recording the statements of persons in the present matter no independent investigation has been carried out by the department. We observed that Department has not brought out any independent facts or evidence as who is the service receivers, whether the cash receipts shown in the xls. Files pertaining to the service component only or otherwise and no corroborative evidence produced in support of details mentioned in the said xls. files. In the present matter allegation of the revenue are that appellants collected the huge amount of cash in respect of provisions of services involved. However not a single rupee of unaccounted cash was found during the search conducted by revenue in the business premises of the appellants.
In the present matter appellants disputed the finding of the Ld. Commissioner on the ground that Ld. Commissioner has relied upon the statements of persons but these statements are not admissible as evidence because the mandatory procedure laid down under Section 9D of the Central Excise Act as made applicable in relation to service tax by virtue of Section 83 of the Finance Act 1994 is not complied.
In the present matter it is admitted facts that Statements recorded during investigation in the present matter, whose makers are not examination-in-chief before the adjudicating authority, would have to be eschewed from evidence, and it will not be permissible for Ld. Adjudicating Authority to rely on the said evidences. Therefore, none of the said statements were admissible evidence in the present case.
Section 36B(2) provides the conditions in respect of computer printouts. In the present matter the computer was not shown to have been used regularly to store or process information for the purposes of any activities regularly carried on by the appellants. It was also not shown that information of the kind contained in the computer printout was regularly supplied by the appellant to the computer in the ordinary course of activities - Electronic records being more susceptible to tempering, alteration, transposition, excision etc. without such safeguards, the whole trial based on proof of electronic records can lead to travesty of justice. The provisions of Section 65B of Indian Evidence Act and Section 36B of Central Excise Act, 1944 of the Act are pari-materia. It is evident from the panchanama, and the appeals records that the investigating officer had failed to follow the safeguard as mandated under Section 36B of the Act.
In the present matter the investigating officers failed to comply with the conditions of Section 36B of the Act in respect to relying upon this computer printout. In view of the above the service tax demand based on such unauthenticated data is not sustainable and hence are set aside.
The impugned order set aside - appeal allowed.