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2018 (12) TMI 369 - AT - Central ExciseClandestine manufacture and removal - undervaluation - clubbing of clearances - imposition of penalties - suppression of facts and not accounting for actual production to remain within exemption limit as provided in the SSI exemption notifications - Held that:- The evidence brought on record recovered from Shri Mahadev Goel in the nature of private records, cash book, ledger, challans and various files and the statements. Shri Mahadev Goel has retracted his statement and lodged a complaint with Police, these facts have not been contraverted by the Revenue and no further statement has been recorded of Shri Mahadev Goel, therefore, the statement of Sh.Mahadev Goel cannot be relied upon and cannot be the basis of alleged clandestine manufacture and removal of goods. Cross-examination not allowed - Held that:- The statements of the suppliers and buyers which have been relied upon by the adjudicating authority have never been examined in chief and denied cross examination of witness whose statement has been relied without any lawful reason - also the provisions of section 9D have not been followed by the adjudicating authority, therefore, on this sole ground, the impugned order is not sustainable. The statements of various buyers and suppliers have been relied upon by the adjudicating authority and in their statements they have stated they have supplied the goods without cover of invoices or they have purchased the goods from the appellant without cover invoices which means they were involved in the evasion of payment of excise duty but they were not made party to the show cause notice which shows that investigating team adopted pick and choose method as the persons who were involved in evasion of duty were not made party to the show cause notice creates doubt on the statements of these witnesses. Therefore, the statements of these witnesses cannot be relied upon to allege clandestine manufacture and clearance of the goods. Clubbing of clearances - Held that:- Both units are located at a distance of about 60 KM having independent ownership and infrastructure. Each units have its own manufacturing set up and machinery to manufacture heir finished goods independently. In that instant case, their clearances cannot be clubbed to alleged clandestine manufacture and removal of the goods. The adjudicating authority has not given its independent finding on the issue how he arrived on the conclusion that the appellants were engaged in the clandestine manufacture and clearance by undervaluing the same and why cross examination cannot be granted - no corroborative evidence has been brought on record to allege that the clandestine removal of the goods. The demands confirmed against the appellants are not sustainable without any corroborative evidence - Penalties also set aside - appeal allowed - decided in favor of appellant.
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