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2020 (2) TMI 4 - AT - Central ExciseClandestine removal - shortage of finished goods and raw materials, as compared with the stock records - demand on the basis of records recovered and statements recorded under Section 14 of the Central Excise Act - CENVAT Credit - credit denied on the strength of invoices were no goods allegedly were received in the factory of the appellant. HELD THAT:- On perusal of the impugned order passed by the learned Commissioner, it is found that the he has neither followed the provisions of Section 9D of the Central Excise Act, 1944, nor the law laid down by the Hon’ble Punjab and Haryana High Court in M/S G-TECH INDUSTRIES VERSUS UNION OF INDIA AND ANOTHER [2016 (6) TMI 957 - PUNJAB & HARYANA HIGH COURT] - thus, the statements recorded under Section 14 of the Central Excise Act, cannot be relied upon and hence has to be eschewed from the evidence. Further, the ld. Commissioner have not dealt with the stand of appellant, do not have manufacturing capacity to manufacture the goods as alleged by the department. With respect to documents relied upon by department, the author of the said documents has not been identified and examined - In view of the law laid down by the Hon’ble High Court of Chhattisgarh in the case of Hi-Tech Abrasives Ltd. Vs CCE& Customs, Raipur, [2018 (11) TMI 1514 - CHHATTISGARH HIGH COURT], the said documents cannot be relied upon. The department has also not enquired at the end of the buyers and there is no positive evidence adduced by the department. The demand has been confirmed on the basis of assumption and presumption - Therefore, demand of ₹ 44,06,966/- on alleged 2118.733 MT of SS Ingots clandestinely cleared for the period 18.08.2002 to 16.12.2002 is hereby set aside. Further, the stock taking has been conducted on eyes estimation basis, as can be seen from the Panchnama drawn at the factory premises. However, the director Mr. Raman Bhatia and the Authorized Signatory Mr. Rajesh Sharma had expressed satisfaction and agreed with the shortage computed - demand on the alleged shortages is confirmed, but penalties set aside. CENVAT Credit - denied only the basis of statement of transporter and Sh. Rajesh Sharma (Authorized Signatory) - HELD THAT:- The said statements has to be eschewed from evidence inasmuch provisions of Section 9D has not been followed. Therefore, the denial of cenvat credit of ₹ 64,244 is not legally sustainable and hereby set aside. Since the demand is set aside, therefore interest and penalty is also set aside, and further penalty on Sh. Raman Bhatia is also set aside - appeal allowed - decided in favor of appellant.
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