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TMI Blog2012 (2) TMI 469X X X X Extracts X X X X X X X X Extracts X X X X ..... hri Thakur Fateh Singh Ram Singh admitted melting loss of 4% of copper wire scrap and loss of 1% on copper wire scrap covered with insulated material and 1% burning loss. He submits that the lower authorities completely ignored the statement and admitted loss and they have allowed only the burning loss of 1%. He also submits that loss should have been calculated on the quantity of raw materials whereas the same has been calculated on the stock. He submits that the demand had been confirmed only on the statement of authorized signatory and the partner who had admitted that they had cleared 53,704.4 Kgs of finished stocks without payment of duty on the basis of panchnama. He also submits that no further evidence to show clandestine removal had been gathered by the Revenue and no evidences had been brought out. The charge of clandestine cannot be based on assumptions and presumptions and he cited several decisions in support of his arguments. On the other hand ld. DR submits that the case is based on shortage found during visit of the officers and there has been clear admission by authorized signatory and the partner. He relies on the Tribunal decisions in the case of CCE, Surat v. N. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty should have considered all these facts and give his conclusion. In the absence of any specific evidence to support clandestine removal of the quantity, it is necessary that the details given by the appellant subsequently are considered and commented upon. In view of above position, we remand the matter to the original adjudicating authority to consider the data submitted by them in a tabular form in reply to the show cause notice and their contentions regarding the methods to be adopted for calculation of melting loss/burning loss, etc. Needless to say that appellants shall be given an opportunity to present their case again before fresh adjudication if they so desire. (Pronounced in the Court on.........Dec., 2008) 4. [Per : Archana Wadhwa, Member (J)]. - After going through the order proposed by my learned brother Member (Technical), I record a separate order. 5. Admittedly, at the time of visit of the officers in the appellant's factory, no discrepancy was found either in the raw material stock of the finished goods, when compared to the statutory record. It is on the basis of the quantum of the input utilized by the appellant that the officers entertained a view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me had indeed been removed and the dispute is only about the quantity. Learned advocate's with reference to the quantity of shortages was as an alternative ground and without prejudice to their main submission of absence of evidence of clandestine removal. 7. I further note that my learned brother has also recorded that in absence of any specific evidence to support the clandestine removal of the quantity, it is necessary that the details given by the appellant subsequently are considered and commented upon. While agreeing with my learned brother that there is no specific evidence to uphold the finding of clandestine removal, the remand of the matter for re-calculation of shortages would be only a theoretical exercise. It is settled law that such calculation of shortages arrived at on the basis of input-output calculation, cannot be made the basis of clandestine removal. The appellants have also challenged that the statement of the authorized signatory as also by the partner do not stand corroborated with sufficient evidence as they are against the record and cannot be made the sole basis for holding against them. I agree that the veracity of the statements has to be gauged f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e alternative. (iv) Whether the statements made by authorized signatory and by the partner are required to be corroborated with sufficient evidence for arriving at the findings of clandestine removal. (v) Whether the statements, which are against the records, can be made sole basis for upholding the findings of clandestine removal. (vi) Whether, in the facts and circumstances of the case, the matter is required to be remanded for re-calculation of duty as held by Member (Technical) or appeals are required to be allowed as held by Member (Judicial). (Pronounced in the Court on 24th Sep., 2010) 10. [Per : M.V. Ravindran, Member (J)]. - This Difference of Opinion is listed before me as per order of Hon'ble President for deciding the points of difference arose between the Bench while deciding the appeal Nos. E/877 to 879/2005. 11. Following Difference of Opinion are indicated :- (i) Whether the finding of clandestine removal can be upheld on the basis of input-output ratio of raw materials and final product. (ii) Whether the plea of the appellant that even as per the calcul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld submit that as regards the evidence of clandestine manufacturing and clearance, the law is squarely settled in the case of Durga Trading Company - 2002 (148) E.L.T. 967 (Tri.-Del.) and upheld by the Apex Court as reported in 2003 (157) E.L.T. A315 (S.C.). It is his submission that there is nothing on record indicating who are the purchasers of the finished goods clandestinely removed and whether the said goods were removed from the factory premises and investigations has awfully short of putting any evidence. 13. He would also rely upon the judgment of the Tribunal in the case of Suzlon Fibres Pvt. Ltd. v. CCE, Surat - 2008 (230) E.L.T. 166 (Tri.-Ahmd.), wherein it was held that the case of clandestine manufacture and removal will be only on input-output ratio and no other evidence in such cases requires proof beyond doubt on the basis of concrete and positive evidence. He would also rely upon the judgment of Hon'ble High Court of Gujarat in the case of Nissan Thermoware Pvt. Ltd., 2011 (266) E.L.T. 45 (Guj.), wherein Hon'ble High Court has clearly held that except for the shortage of raw material which is disputed by the assessee and statement of the Director, there bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Fibres Pvt. Ltd. (supra), in Para 3 has categorically stated as under : "3. We agree with the above contention of the ld. Advocate, apart from the input-output ratio, there is no evidence on record to show clandestine manufacture and clearance of the goods. Such cases are required to be established beyond doubt on the basis of concrete and positive evidences. We accordingly set aside the impugned order and appeals are allowed with consequential relief." 17. My view as regards there cannot be allegation of clandestine removal unless there is an evidence to indicate that there was clandestine manufacturing, is fortified by the judgment of Hon'ble High Court of Gujarat in the case of Nissan Thermoware Pvt. Ltd., wherein their Lordship have held as under : "7. Thus, on the basis of findings of fact recorded by the Tribunal upon appreciation of the evidence on record, it is apparent that except for the shortage in raw material viz., HD which was disputed by the assessee and the statement of the Director, there was no other evidence on record to indicate clandestine manufacture and removal of final products. On behalf of the revenue, except for placing reliance upon t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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