TMI Blog2018 (3) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... umptions. Appeal dismissed - decided against Revenue. - D. B. Central/excise Appeal No. 2, 3 /2018 - - - Dated:- 14-3-2018 - K. S. Jhaveri And Vijay Kumar Vyas, JJ. For the Appellant : Mr. Anuroop Singhi ORDER Delay in filing the appeals is condoned. The applications u/s 5 of the Limitation Act are allowed. Defects are waived. In both appeals common questions of law and facts are involved, hence, they are decided by this common judgment. By way of these appeals, the appellant has challenged the judgment and order of the Tribunal whereby the Tribunal has allowed the appeals filed by the assessee. Counsel for the appellant has framed the following substantial question of law:- In Centra/Excise Appeal No. 2/2018 3/2018 i) Whether the Tribunal was correct in allowing the appeals of the assessee, solely by holding that there is no Sufficient corroborative evidence to statement tendered by partner of assessee, even when Statement tendered by Central Excise Officer is admissible before court of law as piece of evidence and thereby deleting the penalty of ₹ 2,00,000/-? Now the controversy involved in the appeals is covered by the decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been observed:- 26. It is also the findings on the part of the Tribunal to state that there was no effective and reliable denial on the part played by the appellant either in the proceedings before the Commissioner or before the Tribunal. 27. In fact, the appellant had started retracting his statement of confession itself from the beginning and when that being so, such a finding as has been given by the Tribunal, would not stand in the legal scrutiny. The further reasons given by the Tribunal is that, even though the only defence apparently was that the statements had been retracted, the seizure of gold and the consensual deposition by other witnesses implicating the appellant and therefore, the same cannot be ignored. 2. S.M.A. Siddique vs. Government of India, 1989 (42) E.L.T. (Mad.), wherein it has been observed:- 2. Mr. K. Ramaswami, learned Counsel for the petitioner, would primarily urge that the decision of the Criminal Court on merits and on identical facts and charges having been rendered in favour of the petitioner, anterior to the disposal of the appeal by the second respondent, it would be unfair and not in consequence with the principles of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Schedule to the Central Excise Tariff Act, 1985. The factory premises of the Respondent came to be searched on 9-7- 2003. According to the Appellant, during the course of search, on physical verification of finished processed cotton fabrics and man made fabrics at the various stages of processing i.e., bleaching, dyeing, printing, finishing, packed in HDPE bags on comparison with recorded stock, a shortage of 175178 L. mtrs. of processed MMF valued at ₹ 31,53,204/- involving Central excise duty of ₹ 3,15,329/- was detected. Accordingly, a panchnama came to be drawn recording the said facts. Statement of a Director of the Company, Shri Rajnikant Omkarmal Agarwal also came to be recorded, under Section 14 of the Act, wherein apart from several other admissions, he admitted the contents of the panchnama. Statements of other employees of the Respondent were also recorded under Section 14 of the Act. Subsequently, a show cause notice came to be issued to the Respondent calling upon it to show cause as to why Central excise duty amounting to ₹ 4,30,275/- should not be demanded under Section 11A of the Act, as well as, as to why mandatory penalty and penal interest sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t possible to state that the conclusion arrived at by the Tribunal is, in any manner unreasonable so as to warrant interference. A case of clandestine removal of goods has to be made out on facts which find corroboration from the material on record. In absence of any corroborative material, no demand could have been raised merely on the basis of a statement recorded under Section 14 of the Act, which had been subsequently retracted. 4. Continental Cement Company vs. Union of India, 2014 (309) E.L.T. 411 (All.), wherein it has been observed:- 12. Further, unless there is clinching evidence of the nature of purchase of raw materials, use of electricity, sale of final products, clandestine removals, the mode and flow back of funds, demands cannot be confirmed solely on the basis of presumptions and assumptions. Clandestine removal is a serious charge against the manufacturer, which is required to be discharged by the Revenue by production of sufficient and tangible evidence. On careful examination, it is found that with regard to alleged removals, the department has not investigated the following aspects: (i) To find out the excess production details. (ii) To f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such a huge demand was, thus, totally arbitrary and has been rightly set aside. 9. It is apparent that the demand was raised and a sum of ` 14 lacs was taken on the same day and in order to justify the said demand which had been encashed, a show cause notice was issued on 25.04.2006 thereafter. Thus, not only the demand was confirmed but even the penalty had been imposed, which was without any basis. The confirmation is not only on the manufacturer but also on the Proprietor. Such action which had illegally created the demand without even meeting the defence of the manufacturer, has, thus, been rightly set aside by the Commissioner (Appeals) and upheld by the Tribunal. The retraction was made at the earliest, the moment the show cause notice was served and in such circumstances, the questions of law which have been raised by the appellant are answered against the appellant-Revenue and the appeal is, accordingly, dismissed. 7. We have heard learned counsel for both the parties. 8. Taking into consideration the ratio laid down by the Allahabad High Court, as quoted above, only on the basis of statement of Tara Chand who was the partner of the Company, case of the depa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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