TMI Blog2017 (1) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... nsustainable. The allegation of clandestine clearance is to be established by the Revenue on the basis of tangible evidence. Before sustaining the allegations, the same needs to be corroborated and supported by detailed investigation. We find that no investigation has been conducted into the procurement of additional raw material required for manufacture of such huge quantity of goods alleged to have been clandestinely cleared - Nothing has been brought on record regarding payment received for such clandestinely cleared goods. Some cash has been seized from the residence of Director which is alleged to be the sale proceeds of clandestinely cleared goods. Once the allegation of clandestine clearance is not sustained, there is no justif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e residence of Shri Vinod Agarwal, Director, which was also seized on the ground that it was the sale proceeds of the goods clandestinely removed by the appellant. Statements were recorded during the course of investigation from Shri Rohit Aggarwal, Director, and Shri S K Chpora, employee of the appellant company. Show cause notice dated 17.3.2006 was issued proposing confiscation of the seized goods as well as seized Indian currency and for imposing various penalties under various provisions. 3. During the course of investigation, the seized records were scrutnized and several statements were recorded from persons connected with the appellant company. In particular the following records were seized: (i). Three slips which were found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntention of the appellant is that Revenue has based its calculations on the basis of statements recorded from -Shri S K Chopra, employee of the factory. Such statement given by Shri S K Chopra has since been retracted. During the cross examination of Shri Chopra before the adjudicating authority, he has deposed that his earlier statement was recorded under threat of arrest and were not given voluntarily. In his explanation of figures appearing in the slips, he has submitted that the first figure indicates level of oil in the tank; the second figure indicates temperature of the furnace and the third figure indicates oil level in the underground oil tank. Accordingly, the submission of the appellant is that the very basis adopted by the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d only in respect of Shri S K Chopra. The deposition of Shri S K Chopra has established that original statement given by him had been obtained under duress. However, his deposition in cross examination has not been considered by the adjudicating authority. He has simply rejected the deposition as an after thought. The appellant has also alleged that the value adopted for working out demand has been taken as abnormally high. 8. The show cause notice has worked out the demand by taking the value of the finished product as ₹ 225 per Kg whereas in the seizure panchnama dated 21.9.2005, the value has been taken as ₹ 170 per Kg. They have submitted that in case demand has to be confirmed, the lower value may be adopted and same ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l statement has been recorded by the Revenue authorities under duress. During cross examination, Shri S K Chopra has also given different interpretation of the figures contained in two recovered slips. If the later explanation is taken into account, the entire duty demand becomes unsustainable. 12. We find that the duty demand of such a huge amount has been made only on the basis of two slips and supporting statements, which have been retracted. In the cross examination, the witness has given an entirely different explanation. In the circumstances, the documentary evidence recovered from the factory in the form of three slips containing a few figures is to be considered as untrustworthy. The allegation of clandestine clearance is to be e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upported by evidence brought on record by investigations as held by the Hon ble Allahabad High Court in the case of Continental Cement [2014 (309) ELT 411 (All)]. 14. From the discussions in the above paragraphs, we find that the evidence produced by the Revenue for sustaining the duty demand have not been corroborated by detailed investigations. The allegation of clandestine manufacture and clearance cannot be sustained on the basis of such flimsy evidence. We also find goods have been seized from factory on the date of search. 15. Some cash has been seized from the residence of Director which is alleged to be the sale proceeds of clandestinely cleared goods. Once the allegation of clandestine clearance is not sustained, there is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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