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2022 (5) TMI 648 - AT - Central ExciseClandestine removal - entries in Booking registers of transport commission agents, can establish clandestine removal or not - third party’s records - corroborative evidences or not - preponderance of probability - cross-examination of statements - Section 9D of the Central Excise Act, 1944 - HELD THAT:- The allegation of clandestine removal of excisable goods was totally based on entries found/ recorded in the records of transporters and brokers against the name of the appellant and transporters and brokers have admitted in their statements recorded by the department specifically that they have loaded and transported the said alleged goods without the cover of invoices from the premises of the appellant. However, department has not produced any loading advices or consignment notes issued by the transporters in respect of alleged quantity of excisable goods. Further on a careful consideration of the facts and records, it is noticed that mere entries found recorded in the records of said Transporters and brokers are not sufficient to confirm the demand of duty and allegation of clandestine removal. It is settled law that documents recovered from a third party can be used against the manufacturer to prove clandestine removal only when these are supported with corroborative evidences. The Revenue has alleged that huge quantity of finished products have been manufactured and cleared clandestinely without payment of Central Excise duty - the investigation has not tried to approach any of the buyers to corroborate the documents recovered from transporter and broker. The investigation also failed to establish the procurement of raw materials attributed to the huge quantity of alleged clandestine removal. In fact on the date of search, no discrepancy was recorded in respect of stock of raw materials and finished goods vis-a-vis that recorded in statutory records. It is true that the evidence which is required to be produced in quasi judicial proceedings should be such that the charges get established on the basis of preponderance of probability. The standard of evidences need not be as high as in criminal proceedings, where the charges are required to be established beyond reasonable doubts. But in the present case, the allegation of clandestine manufacture and clearance has not been substantiated by any tangible evidences - the law as to whether the third party records can be admitted as an evidence for arriving at the findings of clandestine removal, in the absence of any corroborative evidence, is well established. Undervaluation of the goods - HELD THAT:- The data given by M/s Major & Minors indicates the daily prices for various sizes of rolling plates as well as mixed melting scraps obtained out of ship breaking activities. After comparing both data revenue found that Appellant have undervalued the scrap and evaded Central Excise Duty. After undergoing the changes in Section 4 in the year 2000, the value of excisable goods is the transaction value and there is no provision to adopt any other deemed value. Therefore only on the basis of rate published in a publication, the transaction value can not be doubted. Except the basis of publication, there is no charge of extra consideration flowing from buyers of goods to the appellant over and above the invoice value. Therefore charge of under valuation has no legs to stand. The demands of duty, interest and penalty are not sustainable in the facts of these cases. Consequential penalty imposed on other Appellants also does not survive - appeal allowed - decided in favor of appellant.
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