TMI Blog2015 (4) TMI 891X X X X Extracts X X X X X X X X Extracts X X X X ..... plained by the investigating officers during the cross examination, appears to be a casual approach. The Adjudicating Authority observed it might be mistakenly shown as 3 bales against 27 bales in the pocket diary. In some cases, it is observed that the name of the consigner or the party code was not mentioned in the lorry receipts but the other details of lorry receipts are tallied with the gate-pass book of the transporters. It is relied upon the grey register recovered from the transporters to corroborate the pocket diary. The appellant disputed grey register of the transporters and requested the cross examination of the transporters, which has not been allowed. - there were discrepancies in the pocket diary and grey register as well as the documents of the transporters cannot be accepted as the cross examination of the transporters was not allowed. It is also disputed the contents of Lorry Receipts recovered from the transporter in so far as out of 17 LRs not a single LR is in the name of the Appellants either as consignor or as consignee. Further as per the said LRs deliveries were made from Bhiwandi to Saroli and no consignment was delivered from/to the Appellants address. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rma, Excise Clerk. The said officers recorded the statements of the Excise Clerk and partner of the Appellants (Appellant No.2) on 9.7.1998 and 10.7.1998. Further, on 1.1.1999 a statement was recorded of Appellant No. 2. The said officers also visited the premises of transporter. 3. A show cause notice dtd 5.1.1999 was issued proposing demand of duty alongwith interest and penalty on the basis of the pocket diary on Appellant No.1. It has also proposed to impose penalties on Appellant No.2, Shri Ramchandra M Sharma, Excise Clerk and M/s Moongipa Roadways Pvt Ltd, transport company. It was further proposed to confiscate the seized goods and plant and machinery. By the impugned order, the Commissioner of Central Excise Customs, Surat, confiscated the seized goods and imposed redemption fine of ₹ 2,60,000/- and also confirmed the demand of duty ₹ 21,30,806/- alongwith interest on the finished products removed illicitly on the basis of pocket diary and imposed penalty of equal amount of duty on the Appellant No.1. It has also confiscated the land, building, plant and machinery used for manufacture, production, storage, removal of offending goods under Rule 173(Q)(2)(a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the buyer, to establish the clandestine removal of goods. Learned Advocate also submits that confiscation of raw material is contrary to the provision of Rule 173 (Q) of the Central Excise Rule 1944. He relied upon the decision of the Tribunal in the case of Arya Fibres Pvt Ltd vs CCE, Ahmedabad II 2014(311)ELT.529 (Tri. Ahd.). 5. On the other hand, the Learned Authorised Representative for the Revenue drew the attention of the Bench to the relevant portion of the adjudication order in so far as the investigating officers during the cross examination had deposed that the panchnama was prepared in the presence of panchas and partner. Thus, there is no irregularity in the preparation of panchnama. He further submits that the pocket diary was recovered from the socks of the Excise Clerk. The contents of the pocket diary are corroborative with the transporters grey register. He further submits that the Excise Clerk admitted the recovery of pocket diary in his statement dtd 9.7.1998 and 10.7.1998, which was not retracted by him. The partner of the appellant firm also admitted in his statement and belated retraction of the statement has no evidentiary value. He also drew the atte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 21.8.2008 that he participated in the preparation of the panchnama and conducting inventory of stock in the factory. On being asked as to why 320 pcs were seized when as per diary there should be physical stock of 973 pcs and as per lot register, there should be 976 pcs, he stated that the seizure of that quantity of unaccounted goods were affected, which were available in the factory. Further, on being asked, on other issues, he stated that since considerable time has elapsed, he was unable to explain the exact reason, and he did not prepare the Annexure-A of the Panchnama. There is no dispute that some spaces in the Panchnama were left blank, which could not be explained by the investigating officers during the cross examination, appears to be a casual approach. 8. The Learned Advocate drew the attention of the Bench to the discrepancies between pocket diary and the transporters documents. I find that the appellant in reply to the show cause notice stated that by separate affidavits of partner and Excise Clerk, they categorically affirmed that they were totally ignorant of the contents of diary and the Central Excise officers had brought the diary with them. Without going i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CE 2009(242)ELT.189 (Del) held that if the cross examination is not permitted, the documents cannot be relied upon. The Hon ble Delhi High Court in the case of Basudev Garg vs CC 2013(294)ELT.353 (Del.) allowed the appeal of the appellant held that documents cannot be used without giving them opportunity of cross examination. Hence, in the present case, there were discrepancies in the pocket diary and grey register as well as the documents of the transporters cannot be accepted as the cross examination of the transporters was not allowed. It is also disputed the contents of Lorry Receipts recovered from the transporter in so far as out of 17 LRs not a single LR is in the name of the Appellants either as consignor or as consignee. Further as per the said LRs deliveries were made from Bhiwandi to Saroli and no consignment was delivered from/to the Appellants address. As regards Grey Register, the said register is maintained truck-wise by Moongipa Roadways P Ltd. Further in the said register, nowhere the Appellant name was mentioned. 11. I find that the Adjudicating Authority had proceeded only on the basis of the statements dtd 9.7.1998 and 10.7.1998 of the partner and Excise C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduction or storage of any excisable goods, then all such goods are liable to confiscation. In the present case, none of the ingredients of sub rule (1) of 173(Q) of the said Rules would be applicable, and no Modvat Credit was availed by the appellant on the seized raw materials. So, confiscation of raw material and imposition of redemption fine would not sustained. The Tribunal in the case of Aishwarya Plast Exporters Pvt Ltd vs. Commissioner of Central Excise, Vadodara 2009(246)ELT.728 (Tri.Ahmd.) held that excess raw material lying in factory premises, non-recording would not invite confiscation. So, the confiscation of the raw material, plant and machinery would not be sustained. 14. In view of the above discussions, the confiscation of seized goods, plant and machinery etc., and imposition of redemption fine and demand of duty alongwith interest and penalties on the appellant are not sustainable. Accordingly, the impugned orders are set aside. Both the appeals filed by the appellants are allowed with consequent relief. The application filed by the appellant for recalling Miscellaneous Order dt 6.1.2015 is dismissed as infructuous. (Dictated and pronounced in the Court) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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