2015 (12) TMI 1911 - HC - Central Excise

Confirmation of demand and proposal made in the show cause notice only on the basis of statement dated 09.07.1998 and 10.07.1998 of the partner and the excise clerk of the assessee respectively in absence of any corroborative cogent and material evidence - none of the ingredients of sub-rule (1) of Rule 173(Q) of the Central Excise Rules 1944 exist - no Modvat Credit was availed by the respondent on the seized raw material - confiscation - redemption fine - HELD THAT - Upon perusal of the judgment of the Tribunal and upon hearing learned learned Counsel for the Revenue it is noticed that in the said judgment the Tribunal observed that the appellants had disowned the pocket diary contents of which were heavily relied by the Department. The Tribunal found discrepancies in the entries of the diary as well as in the panchnama drawn by the Department which the Department could not reconcile. Inter alia on such grounds the appeal of the assessee was allowed. It can be seen that the entire issue is purely factual in nature. No question of law arises. Tax Appeal is dismissed.

Summary

The Gujarat High Court, in an oral order by Hon'ble Mr. Justice Akil Kureshi, dismissed the Revenue's appeal against the CESTAT's judgment. The appeal questioned whether the CESTAT was justified in upholding the adjudicating authority's demand based solely on statements dated 09.07.1998 and 10.07.1998 without "corroborative, cogent and material evidence," and whether the ingredients of sub-rule (1) of Rule 173(Q) of the Central Excise Rules, 1944, were met to justify confiscation and redemption fine.The Tribunal had found that the appellants disowned the pocket diary relied upon by the Department, noting discrepancies in diary entries and the panchnama which the Department failed to reconcile. On these factual grounds, the Tribunal allowed the assessee's appeal.The High Court held that the issue was purely factual with "no question of law arises" and accordingly dismissed the Tax Appeal.