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2017 (7) TMI 841 - AT - Central ExciseClandestine manufacture and removal - undervaluation - it was alleged that the assessee was removing drilling rigs, hammer assemblies and parts without accountal and without payment of duty and also indulging in under-valuation/under-invoicing of drilling rigs, such operations were conducted at various premises connected with the assessee on 26.03.2003 - Held that: - the adjudicating authority has analysed and addressed all these three issues in the impugned order. Adjudicating authority also accepted the request of KLR for cross examination of the persons whose statements have been relied upon in the show cause notice. The details of such cross examinations have been given in paras 32 to 43 of the impugned order. Perusal of these paras will indicate that the persons who were cross examined have, in the depositions given by them in cross examination, mostly given averments contrary to what had been purportedly given by them earlier in the statements recorded from them by the department officers. In other words, the statements of such persons, which have been relied upon in building up the case against KLR have been retracted by the same persons in the subsequent depositions in cross examination. On the dispute concerning alleged suppression of value of drilling rigs, adjudicating authority has thoroughly analysed the controversy in paras 55.2 to 71 of the impugned order. Lower authority has observed that there is no mention in the show cause notice whether spares sent along with rigs termed as free replacement parts were manufactured by KLR or were bought out ones. He has also observed that while customers had paid extra amounts of cash over and above the invoice price, this could be attributed to the free replacement parts also supplied. We find that this observation of adjudicating authority has merit. From the facts on record, none of the customers from whom statements had been recorded have admitted to any connivance with KLR to suppress the value of the rigs in their mutual interest. Adjudicating authority is also correct in his finding that the department also has not been able to get any evidence of such alleged collusion between customers and KLR in the alleged suppression of value of rigs. Appeal allowed - decided partly in favor of appellant.
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