TMI Blog2015 (7) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... e of raw material by the Appellant for manufacture of goods cleared on payment of duty during the relevant period - case cannot be made only on the basis of note books maintained by the workers unless supported by corroborative evidence with regard to purchase of material, seizure of goods, money flow back etc. No cash has been seized any where when huge cash transactions are alleged to have been made. - Decided in favour of assessee. - Appeal No. E/10689-10690/2015 - Order No. A/11033-11034/2015 - Dated:- 17-7-2015 - Hon ble Mr. H. K. Thakur, Member (Technical),J. For the Appellant : Shri Alok Barthwal, Shri R.K. Jain , Advocates. For the Respondent : Shri S.K. Shukla, Authorised Representative ORDER Per: H.K. Thakur Appeal No.E/10689/2015 has been filed by the main Appellant M/s Bajrang Castings Pvt.Ltd. against OIA No.AHM-EXCUS-002-APP-191 to 198-14-15, dt.20.02.2015, passed by Commissioner (Appeals-II) Ahmedabad as First Appellate Authority. Appeal No.E/10689/2015-SM is filed by Shri Amit R. Bhasin, who is the Director of the main Appellant. 2. Shri Alok Barthwal (Advocate) and Shri R.K. Jain (Advocate) appeared on behalf of the Appellants. Shri Al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly ₹ 3,52,890.00 against a demand of ₹ 31,17,904.00. That out of these 5 ship breaking units, 3 ship breaking units have refused having not supplied goods alongwith documents. Learned Advocate made the Bench go through the statements of Shri Satyapal Wilaitiram of M/s Maria Ship Breaking. Shri Maheshbhai Dayal Patel of M/s P. Patel Ship Breaking Co. and Shri Ramesh Agarwal of M/s Hoogly Ship Breakers to argue his case. He also relied upon the following case laws to argue that no case can be made out against the Appellants as no investigation has taken place at the end of recipients of clandestinely diverted inputs i.e. M.S. Patel Steel Industries Rolling Mills or M/s Panchtantra:- a) Monarch Metals P. Ltd Vs CCE Ahmedabad [2010 (261) ELT 508 (Tri-Ahmd)] b) CCE Ludhiana Vs Parmatma Singh Jatinder Singh Alloys Pvt.Ltd. [2011 (266) ELT 67 (Tri-Del)] 2.2 Learned Advocate emphasized again that in the absence of any cross objection of the witnesses, no case of clandestine activity can be established only on the basis of few statements as held in Basudev Garg Vs Commissioner of Customs [2013 (294) ELT 353 (Del.)] and CCE Daman Vs Dhakad Metal Corporation [2012 (285 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... blishing the case, Revenue has recorded the statements of supplier, ship breaker, broker and his employees, transporters and angadias to the effect that only documents were sold to the Appellant and M.S. Scrap which was in the form of M.S. Plates was sold in cash to certain re-rollers. It is the case of the main Appellant that three out of the five ship breakers have not corroborated case of investigation that M.S. Scrap was not supplied to the Appellant or that the same was diverted to certain re-rolling units on cash payments. It is observed from the answers to Q.No.18.8, 19 20 of the statement dt.26.07.2013 of Shri Satyapal Wilaitiram Singhal, Director of M/s Mariya Ship Breaking Pvt.Ltd; that investigation repeatedly asked him to confirm that M.S. Plates were sold to rolling mills and only documents were sent to the Appellants. Shri Satyapal W. Singhal has denied to have sold such goods to the rolling units. Similarly, two other shipbreaking units M/s P. Patel Ship Breakers Co. M/s Hoogly Ship Breakers have not confirmed that only documents were sent to the Appellants. No statements of the rolling mills, whose names cropped up during the investigation, were recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Basudev Garg Vs Commissioner of Customs [2013 (294) ELT 353 (Del)] held as follows:- 10. Insofar as the general propositions are concerned, there can be no denying that when any statement is used against the assessee, an opportunity of cross-examining the persons who made those statements ought to be given to the assessee. This is clear from the observations contained in Swadeshi Polytex Ltd. (supra) and Laxman Exports Limited (supra). Apart from this, the decision of this court in J K Cigarettes Ltd. (supra) clinches the issue in favour of the appellant. In that case, the validity of Section 9D of the Central Excise Act, 1944 was in question. .... 14. The Division Bench also observed that though it cannot be denied that the right of cross-examination in any quasi judicial proceeding is a valuable right given to the accused/Noticee, as these proceedings may have adverse consequences to the accused, at the same time, under certain circumstances, this right of cross-examination can be taken away. The court also observed that such circumstances have to be exceptional and that those circumstances have been stipulated in Section 9D of the Central Excise Act, 1944. The circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he evidence furnished by entries in books of account if true. While concurring with the above observations the other learned Judge stated as under: If no other evidence besides the accounts were given, however strongly those accounts may be supported by the probabilities, and however strong may be the evidence as to the honesty of those who kept them, such consideration equid not alone with reference to S. 34, Evidence Act, be the basis of a decree. 37. In Beni v. BisanDayal, AIR 1925 Nagpur 445 it was observed that entries in books of account are not by themselves sufficient to charge any person with liability, the reason being that a man cannot be allowed to make evidence for himself by what he chooses to write in his own books behind the back of the parties. There must be independent evidence of the transaction to which the entries relate and in absence of such evidence no relief can be given to the party who relies upon such entries to support his claim against another. In HiraLal v. Ram Rakha, AIR 1953 Pepsu 113 the High Court, while negativing a contention that it having been proved that the books of account were regularly kept in the ordinary course of business a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e two respondents. So far as Shri Advani is concerned Section 34 would not come in aid of the prosecution for another reason also. According to the prosecution case itself his name finds place only in one of the loose sheets (Sheet No.8) and not in MR 71/91. Resultantly, in view of our earlier discussion, Section 34 cannot at all be pressed into service against him. 5. In view of above settled proposition of law, a diary recovered from the broker and few statements alone cannot be made the basis for denying CENVAT Credit to the Appellant in the absence of any cross-examination of the third party witnesses given. Further, there is no evidence of alternative purchase of raw material by the Appellant for manufacture of goods cleared on payment of duty during the relevant period. On this issue, Punjab Haryana High Court in the case of CCE Chandigarh Vs Shakti Roll Cold Strips Pvt.Ltd. [2008 (229) ELT 661 (P H)] has allowed credit. Appeal against this order filed by the Department was dismissed by Apex Court [2009 (242) ELT A 83 (SC)]. CESTAT Chennai in the case of T.G.L. Poshak Corporation Vs CCE Hyderabad [2002 (140) ELT 181 (Tri-Che.)] also held that a case cannot be made o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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