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2018 (2) TMI 1021 - AT - Central ExciseClandestine removal - demand based on the chemist diary as per the panchnama drawn in the factory premises of the appellant - case of appellant is that panchnama is totally silent in respect of the original records. It is not possible to ascertain the writer/author of such photocopies. Held that: - the charge of clandestine of removal of the goods has been made against the appellant on the basis of chemist diaries recovered from the Chief Chemist, the main evidence and on the basis of statements recorded thereof - the Chief Chemist diaries showed that the raw material issued for manufacturing of the goods. The document does not reveal that the fact that the raw material issued for manufacturing has actually been manufactured whereas central excise duty to be paid by the assessee on manufacture of goods. Admittedly, the evidence of manufacturing of the goods has not been coming out from the diaries maintained by Shri Y.K.Bhargava. The contents of the diaries, merely showing issuance of raw materials, in that circumstance, cross examination of Shri Y.K.Bhargava was required to ascertain the truth. During the adjudication, the statement of Shri Y.K.Bhargava was not examined in chief and thereafter no opportunity for of cross examination of Shri Y.K.Bhargava is afforded to the appellant, therefore, there is gross violation of principle of natural justice In terms of Section 9D of the Central Excise Act. The sole basis is the diary maintained by Shri Y.K.Bhargava and prior to June, 2005, Mr. Duggal was maintaining the diaries. Admittedly, the statement of Shri Duggal has not been recorded. Therefore, the contents of the diaries cannot be examined. Moreover, the contents of the diaries maintained by Shri Y.K.Bhargava which is the fact on record are not with the regard to the clandestine removal, in that circumstance, the statement of Shri Y.K.Bhargava cannot be the basis to allege clandestine removal. Te demands on the basis of diaries recovered and other documents recovered from the appellant cannot be the basis to allege clandestine manufacture of the goods - the demands are on the basis of assumptions and presumptions, the charge of clandestine removal of the goods is not sustainable, in the absence of positive evidence or corroborative evidence. Appeal allowed - decided in favor of appellant.
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