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TMI Blog2017 (3) TMI 1350X X X X Extracts X X X X X X X X Extracts X X X X ..... the period December 1993 to October 1994. The case was originally adjudicated vide Order-in-Original dated 27.11.1998, in which the demand was confirmed along with imposition of penalty on the appellant unit and order for confiscation of building, plant and machinery with option to redeem the same on payment of fine of Rs. 10 Lakh. The appellant challenged the above Order-in-Original before the CESTAT, who vide final order No. A/338/2000-NB dated 05.04.2000 [2001 (137) ELT 178 (Tri. Del.)] remanded the matter back to the Original Adjudicating Authority with following terms:- "12. We have considered the submissions of both sides and have perused the impugned order and the record. We find that the claim of the appellants is that they had made detailed submission on the same lines as done before us at the time of adjudication proceedings and they have not been fully dealt with by the Commissioner. On a perusal of the record we agree with the appellants' contention that the impugned order suffers from the vice of not recording the points submitted by the appellants in their defence and the case law relied upon by them at the time of proceedings before the Commissioner. We find, for ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... run three shifts; that they used to dispatch SS flats only; they did not sell/dispatch SS ingots; that they own eight trucks registration Nos. DEG-521, DEG-90, DEG-523, HRS-4890, HRS-4892, HR-10-621, HR-10-1688 and DHL-566 and are exclusively engaged for transportation of SS Flats from the factory to their consignment agents at Delhi and, from there the same were transshipped to other places like Shahpur, Jodhpur and Ahmedabad in the trucks of transporters namely M/s. Singhal Carrier Corporation and M/s. Shree Rama Krishan Carriers Corporation. During the search of Depot of HSPL at A-32, Wazirpur Industrial Area, New Delhi on 06.10.1994, the officers recovered and seized five "Neelgagan" note books (diaries). In these note books (diaries) details of SS Flats loaded in trucks owned by HSLA and received at their Depot at A-32, Wazirpur Industrial Area, New Delhi were mentioned. The details such as Sl. No., Vehicle No., date, time challan No., P. Marks, PC Grade, Challan Weight, Delhi weight, out lorry weight, Truck No. (in which the goods were transported from the factory truck), GR No., transporters loading/ bilty No., name of the party to whom the goods were dispatched were writte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e statutory books of accounts of M/s. HSAL. Scrutiny of loose papers also revealed that out of these sheets, 80 papers/ sheets contain details of consignments of SS Flats which were received by Shri Bijendra Kumar Arya, office clerk from the factory of M/s. HSAL in their own trucks without any statutory documents such as GP-1, invoice and challans etc. These slips contain details viz. No. of pieces of SS Flats, weight, truck No. in which received and the premises at which these were delivered/ unloaded. These details were found to tally with entries available in the later pages of the note books (diaries). 4.2 The scrutiny of GP.1-cum-invoices issued by M/s. HSAL revealed that there were no corresponding GP-1/GP-1-cum-invoices in respect of clearances of SS Flats mentioned in these loose sheets. The entries written on the later pages of the said note books (diaries) and details of these loose sheets tallied with each other. It thus appeared that the entries on receipt of the clandestinely cleared SS Flats were made in the later pages of the said note-books (diaries) maintained by Shri Bijendra Kumar Arya, office clerk of M/s. HSAL who after receiving SS Flats from factory of M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposed that after unloading the goods A-32, Wazirpur Industrial Area, New Delhi their empty vehicles were returned to the factory; that in Delhi they had their agent M/s. V.K. Traders who used to note down the orders of their Bombay, Jodhpur and Ahmedabad consignment agents. He stated that he used to receive drafts and cheques but also received cash from M/s. V.K. Traders, which he used to send to the factory. He gave the details of vehicle registration numbers of eight trucks owned by M/s. HSAL. 4.3 When these five recovered note books (diaries) were shown to Shri Bijendra Kumar Arya, he stated that these note books (diaries) were written in his own hand writing. Further, he went on to explain each entry in the note books (diaries). He identified from the note-books (diaries) the details of goods received from factory of M/s. HSAL along with gate passed/ invoices. He also identified those entries in the note books (diaries) where the goods were received from M/s. HSAL without the cover of gate passes/ invoices. He further identified the entries in various note books (diaries) which were pertaining to cash received by him for onward transmission to the factory. Shri Bijendra Kuma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Arya. 6. In view of the above, show cause notice dated 21.6.1995 was issued alleging that M/s. HSAL cleared 3419.491MT of SS Flats cleared clandestinely valued at Rs. 8.25 Crores involving Central Excise duty of Rs. 1.19 Crores. In the subsequent proceedings, the entire demand stands confirmed. 7. The appellant's stand against the proposal for demand of duty is summarized as below:- (a) The appellant's stand all along has been that the ownership of the seized diaries had not been established. The appellant submitted an opinion dated 01.12.1997 from a hand-writing export Shri V.K. Sakhuja. After examining Shri Bijendra Kumar Arya's hand-writing in his statement dated 28.11.1994 and the writings in the seized diaries the handwriting expert opined that the two hand-writings did not match. This opinion was filed before the adjudicating authority but was ignored by him. (b) It was pointed out that the statement dated 28.11.1994 of Shri Bijendra Kumar Arya was retracted at the first available opportunity, on 2nd December 1994 on the ground that the statement dated 28.11.1994 was taken through threat and coercion. (c) A certificate from local Sales Tax Authorities certifying that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... electricity consumption norms in the appellant's unit. All these expert opinions discount the evidentiary value of the seized documents. (iii) The adjudicating authority did not produce Shri Bijendra Kumar Arya for cross-examination. In the absence of cross-examination of witness, the statement of Shri Bijendra Kumar Arya cannot be relied upon. They relied upon the decision of the Hon'ble P&H High Court in the case of Ambika International - 2016-TIOL-1238-P7H-CX and contended that without producing the witness for cross-examination, the statement cannot be admitted as evidence. (iv) Finally, the appellant has submitted that the whole case is based on the diaries whose source and ownership is doubtful and since the statement of Shri Bijendra Kumar Arya stands retracted, and he was not produced for cross-examination, the case of Revenue does not stand. Accordingly, they prayed that their appeal be allowed. 9. With the above background, we have heard Shri A.K. Prasad, ld. Advocate appearing for the appellant who elaborately argued all the grounds of the appeal. 10. On the other hand, Shri R.K. Manjhi, ld. DR appearing for the Revenue reiterated the findings of the adjudicatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds, cleared without payment of duty. Shri Chatur Singh, General Manager of the appellant in his statement on the date of search has confirmed the fact that Shri Bijendra Kumar Arya is an employee of appellant and is working at A-32, Wazirpur Industrial Area, New Delhi and tasked with the responsibility of receiving the goods from the factory through eight vehicles and to dispatch this cargo further to various consignment agents situated elsewhere in India through other transporters. It is also pertinent to record that both Shri Bijendra Kumar Arya and Chatur Singh have identified the same truck numbers as owned by M/s. HSAL and used for transportation of goods from the factory to the transshipment point. 13. The appellant has contested the above evidence on the ground that Shri Bijendra Kumar Arya retracted his statement given before the departmental officers, four days after it was recorded on 28.11.1994. Further, their submission is that Shri Bijendra Kumar Arya was also not produced before the adjudicating authority for cross-examination. They have also submitted that Shri Chatur Singh, GM, in his statement dated 15.12.1994 has stated that he had no knowledge about the maintena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the facts disclosed by Shri Chatur Singh, GM at the factory. Further, as explained by Shri Bijendra Kumar Arya in his statement, the details on earlier pages of the note-books (diaries) tally with the invoices/ GPs issued by the factory and M/s. HSAL has not disputed the same. Also, Shri Bijendra Kumar Arya has explained the procedure followed by the appellant. These details were deposed by Shri Bijendra Kumar Arya and the officers recording the statement could not have such a detailed knowledge. Even though Shri Bijendra Kumar Arya has filed a letter to retract his statement after four days, it should be considered as an afterthought under the influence of the appellant. 14.2 The appellant's next is plea that the statement is liable to be ignored since Shri Bijendra Kumar Arya has not been produced for cross-examination. From the records, we find that appellant's plea of cross-examination was accepted by the adjudicating authority and summons was issued to Shri Bijendra Kumar Arya for his appearance. Even though the same has been received by Shri Arya's father who, in fact sent a letter informing that where-abouts of his son was not known to him. From the circumstances, we a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e demand of duty. The entries in the note-books (diaries) pertain to cash receipts for clandestinely cleared goods as explained by Shri Bijendra Kumar Arya in his statement. The value of cash receipt worked out to Rs. 1.52 Crores. The details indicated that cash is being collected for sale of unaccounted finished products and the portion of cash, collected by Shri Bijendra Kumar Arya was sent by him to the factory. This evidence cannot be used to argue that the department has failed to prove that cash receipts for the balance amount. Such receipt of cash for clandestine removal cannot be ignored. Clandestine removal is invariably shrouded in dark and the facts cannot be established with mathematical precision. 17. The investigation has established the modus-operandi adopted for evasion of duty i.e. to use their own trucks to transport the accounted as well as unaccounted and clandestinely cleared goods to the transshipment centre at Wazirpur Industrial Area, New Delhi where Shri Bijendra Kumar Arya will receive all the goods. He then further arranges to dispatch these with the help of various transporters and consignment agents. From the recovered note-books (diaries) it is evide ..... 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