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TMI Blog2016 (6) TMI 912X X X X Extracts X X X X X X X X Extracts X X X X ..... s obtained from a registered dealer, without actual receipt of goods investigation was conducted. On scrutiny of input invoices for the period February, 2003 to March, 2007, it was revealed that AEPL availed credit mainly on three items ie. Aluminium wire rods, Aluminium rolled products of various types and Aluminium ingots. The allegation of fraudulent availment of credit is confined with regard to certain consignments of aluminium wire rods and aluminium rolled products. Their major supplier of input was Karnataka Metal Company(KMC) who is a registered dealer. KMC procured goods from M/s Agarvanshi Aluminum Ltd(AAL) M/s Bharat Aluminium Company Ltd (BALCO) M/s Steel and Metals, Aluminium India, Adarsh Aluminium Corporation (AAC) and NALCO. Investigation showed that KMC sold the goods in local market without issuing sale bills. KMC then issued Cenvatable invoices to AEPL and other manufacturers without actual supply of goods. APEL availed credit on such invoices without receipt of goods. 3. A search was conducted in the residential premises of Shri Prabhakar who was the Manager of KMC. Some private records were resumed. Basing upon the entries found in note books, Katcha slips et ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 1,00,000/- was imposed on M/s KMC under Rule 25 of Central Excise Rules, 2002 and Rule 13 & 14 of Cenvat Credit Rules, 2002/2004. Separate penalty of Rs. 1,00,000/- was imposed on Shri Sueresh Tibrewala Managing Director of M/s AEPL. 5. The appellants filed appeal, and vide the order impugned herein the Commissioner (Appeals) upheld the demand of credit of Rs. 8,20,779/- along with interest and equal penalty was imposed. The confiscation of finished goods valued at Rs. 50,81,200/- and imposition of penalty of Rs. 1,00,000/- in lieu of confiscation was set aside observing that the goods are not physically available for confiscation and hence not maintainable. The penalty of Rs. 1,00,000/- imposed on AEPL was reduced to Rs. 50,000/-. The penalty of Rs. 1,00,000/- imposed on Shri Suresh Tibrewala was sustained. The appellants are thus before the Tribunal. 6. The learned counsel appearing for the appellants submitted that the whole case is made up on mere inferences and assumptions. The allegation is based upon the private records/note books/slips etc. resumed from the residence of Shri Prabhakar who was an employee of KMC. That KMC has nothing to do with these records and there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peals) vide order dated 04-12-2009 in Order in-Appeal dated No.99/2009 has set aside the demand raised against M/s Khaitan Electrical Ltd., which was also pursuant to search and seizure of private records of Shri Prabhakar. The Commissioner(Appeals) vide Order 11-12-2009 in Order-in-Appeal No.101/2009 set aside the demand raised against M/s Shri Lakshmi Industries and also set aside the penalty of Rs. 4,00,000/- imposed on KMC. The Commissioner(Appeals) vide Order No.26, 27 and 28/2010 dated 26-02-2010 set aside the demand raised against M/s Prism Airtech and also set aside the penalty imposed against KMC. The learned counsel submitted that all these cases were initiated upon the search conducted in the premises of Shri Prabhakar. The statement of Shri Prabhakar and the documents resumed from his residence, have been elaborately scrutinized in these decisions. He pleaded that the appeals may be allowed. 8. The learned AR Sheri M.K.Mall, Shri Dora Reddy and Shri V.J.Manvatkar supported the findings in the impugned order. They submitted that there is no evidence that the statement of Shri Suresh Tibrewala or Shri Prabhakar was recorded under duress. Therefore, their statements are a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rivers or transporters have been examined. The analysation of evidence in the decisions of connected cases is noteworthy. 10. In Order-in-Appeal No.99/2009, dated 04-12-2009 in the appeal filed by Khaitan Electrical Ltd and KMC, the Commissioner (Appeals) observed as under: As discussed, if the desired thickness is not actually supplied by KMC, the basis for production of blades of standard thickness and/or the alternate source of sheets of desired thickness needed to be identified. The implied or implicit meaning of the charge made is that the sheets of thickness 0.25 and 3.00 have actually been invoiced but have been diverted either by KMC or the appellants and in its place; sheets of desired thickness have been substituted. However, except for the presumption, there is no support to the implied charge by any documentary evidence. Also, there is no incentive for such substitution as the price range of the sheets is more or less same and such sheets are manufactured only by reputed manufacturers and clandestine source of procurement from such manufacturers is not possible except that the source can be by way of diversion from other customers who do not need such sheets. But, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enough to confirm the allegations as held by various judicial fora in several cases. In the absence of corroborative evidence, mere reliance on statements is of no help to the department's case. 13. This Tribunal in the final Order dated 20-01-2016, in the case of M/s Sri Lakshmi Industries Ltd and another has analyzed the very same evidence and has set aside the demand raised on the allegation of fraudulent availment of credit on invoices issued by KMC. After examining the evidences presented by this case, I do not find any ground to take a different view. The whole case is founded on statements and private records of third party, Shri Prabhakar. 14. The Tribunal in the case of CCE, Jaipur Vs Shiv Prasad Mills(P)Ltd 2015(329) ELT 250(Tri- Del) held that the allegation of duty evasion cannot be made basing upon private records and statement of a third party unless cross examination of such person is allowed. It is settled law that confessional statements have to be supported by independent evidence to establish the charge of clandestine manufacturer and evasion of duty. 15. In view of the foregoing discussions, I hold that the impugned orders are not sustainable. In the result, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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