TMI Blog2015 (3) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... cers visited the premises of the assessee and conducted stock verification and recorded the statement without verifying the identity of a person. There is no material available on record to establish that Shri Hakim Thanawala has any connection with the appellant firm. - it is the responsibility of the Revenue to identify the person while recording the statement. It is seen that no statement of any employee of the appellant firm was recorded. The Central Excise officers visited the premises of the appellant firm on 06.3.2007 and show cause notice was issued on 02.6.2009 and no verification was conducted or otherwise. Thus, the demand of duty on the basis of the stock statement and statement of a person, who has no relation with the Appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 90/- alongwith interest and also imposed penalty of equal amount of duty on the Appellant No.1. It has also imposed penalty of ₹ 2,50,000/- on the Appellant No.2, as Director of the Appellant No.1, under Rule 26 of the Central Excise Rules, 2002. It has also confiscated the goods removed clandestinely and imposed Redemption Fine of ₹ 50,000/- on the Appellant No.1. The Commissioner (Appeals) modified the adjudication order to the extent the redemption fine was set-aside. 4. Learned Advocate for the appellants submits that there was no shortage of finished goods and no stock verification was conducted. He submits that the entire proceeding was initiated on the basis of statement of Appellant No.2, who claimed to be a Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Central Excise officers of the HQrs (Preventive) unit, on 06.2.2007, at around 1430Hrs entered into the premises of Appellant No.1 and requested the panchas to witness the proceedings which they agreed to. The Panchas along with Central Excise officers came to the main gate of the appellant firm and asked the security person posted at the main gate of the said unit to call the responsible person from inside. After sometime one person came from the factory who introduced himself as Shri Hakim Thanawala (Appellant No.2) Director of the said unit. The Central Excise officers alongwith panchas and Shri Hakim Thanawala entered into the premises of the Appellant No.1 and conducted the stock verification. The statement dated 07.3.2007 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e alleged stock taking report, insofar as the concerned Central Excise officers had not given the details of the stock verification in the report. It is further contended that the factory was remained closed since 2007, the power supply was disconnected since long for non-payment of the electricity of the bills. 8. By the impugned order, the Commissioner (Appeals) observed that the Panchnama drawn on 07.3.2007 and copy of the same was given to them and the appellants in their reply dated 23.2.2010 defended the case that Shri Hakim Thanawala is not connected with the appellant firm. It is observed that Shri Hakim Thanawala may not be a Director of the unit but he was looking after the affairs of the unit and the Panchnama was drawn in his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of the Revenue to identify the person while recording the statement. It is seen that no statement of any employee of the appellant firm was recorded. The Central Excise officers visited the premises of the appellant firm on 06.3.2007 and show cause notice was issued on 02.6.2009 and no verification was conducted or otherwise. Thus, the demand of duty on the basis of the stock statement and statement of a person, who has no relation with the Appellant firm, can not be sustained. 10. The Tribunal in the case of Vikram Cement (P) Limited vs. CCE, Kanpur 2012 (286) ELT 615 (Tri. Del.) held that in the absence of any other evidence, the sole statement of the Director cannot establish the case of clandestine removal of the goods and burden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eized in contravention of the FERA and Customs Act and that the opportunity has not been given. (iii) In the case of CCE, Madras vs. Systems Components Pvt. Limited 2004 (165) ELT 136 (SC) The assessee was admitting the use of goods for Water Chilling Plant and not disputing the nature of such goods and therefore, the department was not required to prove use of such goods. 12. In view of the above discussions, I find that the demand of duty alongwith interest and penalty on the Appellant No.1 (M/s. Personna Cosmetics) can not be sustained. But, the Appellant No. 2 (Shri Hakim Thanawala) had given a misleading statement to the Central Excise officers and therefore, penalty is warranted. However, considering the fact that Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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