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TMI Blog2017 (8) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... at Rs. 2,08,000/- as also a vehicle valued at Rs. 2 lakhs were placed under seizure. From the subsequent investigations it appeared that cotton yarn on cones manufactured by the appellant were sold using the invoices of "SGT and Sree Vignesh Textiles (SVT in short)". It further appeared that such cotton yarn on cones were sold to the yarn dealers in R. S. Puram, who in turn paid through cheques, which were deposited in banks for clearance to the account of the said SGT, SVT. There were five EB connections also found in the premises of the appellant. It appeared that the appellant had not accounted their production of cotton yarn on cones, that the suppressed production was removed without payment of duty to the yarn dealers in R.S.Puram, us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal remanded the matter for fresh consideration, after allowing the appellant to cross examine the witnesses named in para-14 of the reply to the SCN. In denovo adjudication cross examination was conducted on 10.01.2007 on S/Shri P. Dinesh, Proprietor of SG, Vijayakumar M. Parikh, Proprietor of M/s. Vijay Yarn Corporation and Siddharth V. Parikh, Proprietor of M/s. Siddharth Yarn Traders. After due process of adjudication, the demand of differential duty of Rs. 23,26,451/- for the period 98-99 was confirmed along with interest thereon. Equal penalty of Rs. 23,26,451/- was imposed under Rule 173Q of the erstwhile Rules, equivalent penalty was also imposed under Section 11 AC of the Act. Hence this appeal. 2. Ld. Counsel Shri M.A. Mudima ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of Central Excise duty by clandestine removal. ii) It has been established from the statements and further cross examination that SVT and SGT were only dummy units created on record for transacting clandestinely removed cotton yarn of the appellant. Statements relied in Feb 2000 have been retracted in cross examination in January, 2007. Such retraction after a lapse of 7 years is a belated retraction and does not have a persuasive value. iii) Second stage dealers Shri. Vijayakumar Parikh and Shri Siddharth Parikh have accepted that they have received the yarn of the appellant through the units managed by Shri P. Dinesh (first stage dealer) namely SVT and SGT. 4. Heard both sides and have gone through the records. 5.1 At this second ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from KGT during 1998-99. The Tribunal also noted that the adjudicating authority found clandestine removal of goods merely on the basis of uncorroborated statements. The relevant portion of that order is worth reproducing:- "5. In this case, no excess stock of goods was found in the factory at the time of inspection, no documents indicating suppression of purchase of raw material or of production of finished goods was recovered, no seizure or recovery of any duplicate or fake invoices or delivery challans was made and no physical movement of goods without proper invoices or without payment of duty was noticed for the period of dispute. The adjudicating authority found clandestine removal of goods merely on the basis of uncorroborated stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f remand, directing the adjudicating authority to pass a fresh order after allowing the appellant to cross-examine the witnesses named in para 14 of his reply to the show-cause notice. Needless to say that the appellant shall be given a reasonable opportunity of being heard." 5.3 In response to the above directions of the Tribunal, cross examination was got done of S/Shri P. Dinesh, Proprietor of SGT, SVT, Vijayakumar Parikh, Proprietor of M/s. Vijay Yarn Corporation and Siddharth V. Parikh, Proprietor of M/s. Siddharth Yarn Traders. All these persons have clearly disavowed the demands purportedly made in their earlier statements recorded by the Departmental Officers. However, we are unable to understand why the adjudicating authority has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh a letter or in cross examination, absolute reliance on such statements cannot then continue to be made. This is all the more important when the inculpatory admissions initially made at the time of recording statements are not backed up by sufficient documentary or other corroboratory evidence, as it is the case herein. As observed by the Tribunal in the Final Order dated 22.09.2004, no excess stock of goods was found in the factory at the time of investigation, no documents indicating suppression of purchase of raw materials or of production of finished goods was recovered, no seizure or recovery of any duplicate or fake invoices or delivery challans was made and no physical movement of goods without proper invoices or without payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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