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2015 (2) TMI 791 - CESTAT MUMBAICENVAT Credit - differential quantity of scrap - shortage has been found on eye estimation basis - statements were recorded under threat - during the course of adjudication, the appellants sought cross-examination of Panchas witnesses which was denied - violation of principles of natural justice - Held that:- In this case an investigation was done in the factory on 31.07.2002. It is an admitted fact that physical verification of raw material was not done and the stock was taken on eye estimation basis. It was found that there was shortage of 2042.405 M.T. Therefore, the CENVAT credit was attributed to the shortage which was worked out to ₹ 17,97,316/-. The weighment of raw material was disputed by the appellants on the very next day and lodged their protest before the Addl. Commissioner concerned and request for weightment on physical basis of raw material but the said request has been turned down by the adjudicating authority on the premise that the letter dated 01.08.2002 is an after-thought. I have gone through the statement of Director recorded subsequently also but these statements do not confirm the acceptance of the shortage of raw material by the Director. Further, I find that the case has been made out on the basis of Panchnama drawn during the course of investigation and the permission for cross-examination of panchas was not given to the appellants. Therefore, I hold that there is a violation of principles of natural justice. In these circumstances, I set aside the impugned order and remand the matter back to the adjudicating authority - Decided in favour of assessee.
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