Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 2019 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (5) TMI 369 - AT - Central ExciseClandestine manufacture and removal - tangible evidence or not - demand based on mere inferences or unwarranted assumptions - HELD THAT:- Needless to say, a precise enumeration of all situations in which one could hold with certainty that there have been clandestine manufacture and clearances, would not be possible. As held by this Tribunal and Superior Courts, it would depend on the facts of each case. What one could, however, say with some certainty is that inferences cannot be drawn about such clearances merely on the basis of note books or diaries privately maintained or on mere statements of some persons, may even be responsible officials of the manufacturer or even of its Directors/partners who are not even permitted to be cross-examined, as in the present case, without one or more of the evidences referred to above being present. In the absence of any linkage of the factory of appellants, with the alleged Railway Receipts or third party private records or with third party statements, there are no grounds to presume any manufacture and clandestine removal of such huge quantities of cigarettes, especially when appellants operated under physical control of the department. The impugned order is liable to be set-aside on this ground alone. The demanded duty has been quantified by considering each Bag/ package/ bundle mentioned under an RR to be containing 2 cartons, each carton containing 48 Outers of 25 Packs of 10 cigarettes each. The duty which is levied on the concept of manufacture cannot be demanded on any presumptions and assumptions. It is on record that certain RRs, otherwise similar, were discarded as the same pertained to a period prior to commencement of production in LTCPL. This indicates to a vague criteria adopted for selection of evidences on the basis of which whole case is constructed. While going through the extracts of the diary recovered from the railway parcel agents, it can be seen that such diaries are not containing the name of LTCPL or any of its employee. There is no co-relation of the entries made in the diary with the RRs and allegedly manufactured quantities of Cigarettes. The RRs received from railways (LTCPL is not the consignor) was made the main basis to demand duty. The contents of consignments mentioned in RRs are PVC Bundles, Packaging Material, etc. It is alleged to be incorrect but the actual contents of the said parcel were not proved to be cigarettes through any direct evidence of seizure of parcels. Therefore, the Railway receipts cannot be the basis to make the case of clandestine removal of goods. Therefore, the said evidence is not admissible. Apart from lack of specific instances, dates, and quantifications, etc. the said statement(s) referring the managers of the factory is not corroborated with other cognate and admissible evidences. We note that there is a lack of investigation for tracing the managers of the factory -Shri Mohammed Hashmi or Shri Rijwan Khan for recording of their evidences though they have been made a noticee in the matter. There is no evidence to corroborate purchase or consumption of raw materials and there are no investigations of the other factory staff to corroborate the facts of alleged manufacture of goods and clearance - such statement cannot be made a sole basis to confirm charge of clandestine manufacture and clearance of alleged huge quantities of cigarettes, calculated on a presumptive basis. There is no evidence to establish manufacture and clandestine removal of alleged quantities by LTCPL on the basis of which demand of ₹ 657,50,888/- could sustain - demand set aside - appeal allowed - decided in favor of appellant.
|