TMI Blog2018 (11) TMI 411X X X X Extracts X X X X X X X X Extracts X X X X ..... statement of Shri. Naresh Goyal, the impugned order is not sustainable. Reliability on statements - Held that:- The statements of various transporters and Shri. Jayant.K. Viz were never examined in chief, nor offered for cross examination, therefore, the statements on the basis on which cenvat credit sought to be denied are not admissible. The appellants have used these inputs in manufacturing of their final product which have been cleared on payment of duty. These inputs has been procured and paid the payment through banking challans - cenvat credit cannot be denied in the absence of any corroborative evidence. Credit also sought to be denied on the ground that vehicles no. mentioned in the invoices are not capable for transportation of goods up to the factory of the appellants, therefore, the appellants have not received the goods - Held that:- As per the GR issued by the transporter vehicles no. is mentioned as MH04AL829 but due to mistake vehicles no. mentioned in the invoices MH04AC829. Admittedly, c stands for car, L stands for lorry, this mistake is apparent on the invoices but on this ground cenvat credit cannot be denied to the appellant - credit allowed. Reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any of the product manufactured by the appellant. 2. B 4,20,42,887 Cenvat Credit of raw material purchased from M/s Shilex Chemicals, Delhi because only invoices were issued by M/s Shilex Chemcials and no raw material was supplied to appellant. 3. C 1,23,65,293 Cenvat Credit on the raw material because some of the vehicles mentioned on purchase invoices were different vehicle, not registered vehicles and vehicles as owned by one M/s Dashmesh Transport Co. New Delhi. Total 5,55,86781/- 3. The appellant contested the show cause notice and by way of impugned order, a demand of ₹ 4,08,08,426/- was confirmed and equivalent penalty was imposed on M/s Maiden Pharmaceuticals Ltd. and personal penalties were imposed on Shri. Naresh Goyal, Director of the appellant s Company and Shri. Jayant. K. Viz, proprietor of M/s Shilex Chemicals, the supplier dealer of ₹ 40 Lacs and 35 Lacs respectively. Against that order, the appellants are before us. 4. The Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on the statements of transporters that he has not transported the inputs. To support this contention, he relied on the decision of the Hon ble High Court of Punjab and Haryana in the case of Neepaz Steels Ltd. reported in 2008 (230) ELT 218 (P H), CCE Vs. Motabhai Iron Steel Industries reported in 2015 (316) ELT 374 (Guj.) and Bhupinder Steel Pvt. Ltd. (Supra). 7. He also submits that Shri. Jayant.K. Viz in his statement that he had sold PVC material in local market on the direction of appellant s Director. However, in his statement he has not mentioned the name and other details of such parties, therefore, the said statement is vague and in the absence of any corroborative evidence, the statement is not admissible. He further submits that the adjudicating authority on the basis of the statement of Shri. Naresh Goyal, Shri. M.K. Sharma and Shir. Jayant. K. Viz has held that PVC and EVA has not been received by the appellant. It is his submissions that the said finding is illegal and incorrect on the following grounds: (a) Receipt of EVA has not been denied by these statements. (b) Only the non-receipt of PVC has been admitted by the appellant which was only a resu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 829 was involved in transportation whereas investigation was conducted with regard to vehicles no. MH04AC829, further, vehicles no. MH04BY1476 was taken as MH04U1476. Due to this mistake, it cannot be said that vehicles which are carrying goods were having different vehicles. He also submitted that demand for the period upto 26.04.2009 is barred by limitation. He also submits that the appellant has been regularly audited. In fact, DGCEI itself conducted through investigation on 17.02.2006 and nothing adverse was found in the books of the appellant. Consequently, no suppression or fraud can be alleged with respect to part of the demand. The same is also barred by limitation. For the same reasons, no penalty is also imposable on any of the appellants. 10. On the other hand, the ld. AR supported the impugned order and submits that it is facts on record that the supplier/dealer of inputs have denied for transportation of goods up to the premises of the appellant, therefore, the case has made out on the basis of the evidence and on the basis of GRs recovered from the transporters. The GRs recovered from the transporters reveals that the goods never transported up to the place of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of ₹ 11,78,601/- has been confirmed on account of denial of cenvat credit for non receipt of PVC physically in the factory of the appellant. The appellant has not contested the said amount and the same has been paid along with interest, therefore, the same has not subject before us. Accordingly, the said demand is confirmed along with interest. 14. Cenvat credit availed during the period 2006-2007 and 2008-2009 of ₹ 2,72,64,532/- has been denied on the basis of the statement of the transporters and on the ground that EVA were not used in the factory of the appellant. Further, cenvat credit of ₹ 1,23,65,293/- has been denied on the ground that the vehicles no. mentioned in the invoice issued by Shilex Chemicals is not capable for transporting the said goods. As both the issues are inter-linked, therefore, these issues are taken up by the Common findings. 15. We further take note of the fact that whole of the demand is based on the various statements of the transporters supplier, Shri. Naresh Goyal and one of the employees of the appellant. The statement of Shri. Naresh Goyal is not inculpatory. In fact, he has admitted non-receipt of PVC but he has no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the Court considers unreasonable; or (b) when the person who made the statement is examined as a witness in the case before the Court and the Court is of the opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interests of justice. (2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceedings under this Act, other than a proceeding before a Court, as they apply in relation to a proceeding before a Court. 10. We may mention here that as per the record, the adjudication proceedings have not yet commenced. It is in that context, that we shall first consider the issue raised on behalf of the appellants herein. 11. In International Electron Devices Ltd. v. Union of India [ 2010 (252) E.L.T. 352 (All.), a learned Division Bench of this Court was considering an issue of cross-examination of witnesses. The submission there was that the petitioner therein was entitled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no judgments. We may gainfully refer to the judgment in Arya Abhushan Bhandar v. Union of India [ 2002 (143) E.L.T. 25 (S.C.)]. In Sunder Ispat Limited v. Commissioner of Cus. C. Ex., Hyderabad [ 2002 (141) E.L.T. 24 (A.P.)], a learned Division Bench of the Andhra Pradesh High Court held that the witnesses examined on behalf of the Department had to be produced for cross-examination in accordance with the principles of natural justice. We may also refer to the judgment of the Supreme Court in Lakshman Exports Limited v. Collector of Central Excise [ 2002 (143) E.L.T. 21 (S.C.)]. This also was in respect of proceedings in adjudication proceeding. That cross-examination at the stage of adjudication cannot be denied, is rectified in a large number of judgements. See : Gyan Chand Sant Lal Jain v. Union of India [ 2001 (136) E.L.T. 9 (Bom.)], Swadeshi Polytex Ltd. v. Collector of Central Excise, Meerut [ 2000 (122) E.L.T. 641 (S.C.)], Prayagdas Tushnial v. Collector of C. Ex. Land Customs, Shillong [ 2000 (125) E.L.T. 377 (Gau.)], Lachmandas Tobacco Dealer v. Union of India and Ors. [1978 (2) E.L.T. J502 (Del.)] and Kalra Glue Factory v. Sales Tax Tribunal and Ors. [1987 (66) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... through banking challans. In that circumstances, relying on the decision of Neepaz Steels Pvt. Ltd. (Supra), cenvat credit cannot be denied in the absence of any corroborative evidence. Moreover, we take note of the fact that the Revenue has failed to establish if the inputs in question has not been received by the appellant than from where the appellant has receipt the inputs to manufacture the goods which have been cleared on payment of duty. In that circumstances, in the absence of proper investigation, the cenvat credit cannot be denied to the appellant. 18. We further take note of the fact that cenvat credit also sought to be denied on the ground that vehicles no. mentioned in the invoices are not capable for transportation of goods up to the factory of the appellants, therefore, the appellants have not received the goods. We have gone through the records place before us, wherein, as per the GR issued by the transporter vehicles no. is mentioned as MH04AL829 but due to mistake vehicles no. mentioned in the invoices MH04AC829. Admittedly, c stands for car, L stands for lorry, this mistake is apparent on the invoices but on this ground cenvat credit cannot be denied to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e conclusions. However, before that the party seeking to produce the same must show that any of the circumstances mentioned in Section 65 of the Act exists warranting leading of secondary evidence. The controversy is generally with regard to cases falling under clauses (a) or (c) of Section 65 of the Act wherein the original is alleged to be lost or in the possession of opposite party. 10 The Hon ble Supreme Court in Ashok Dulichand v. Madhavlal Dube 1975(4) SCC 664, while dealing with a case under clause (a) of Section 65 of the Act, upheld the decision of the High Court wherein it recorded a finding that the photostat copy did not appear to be above suspicion and could not be admitted. In arriving at this finding, the High Court considered the facts that there was no other material on the record (except the affidavit of appellant himself) to indicate that the original document was in the possession of respondent No. 1, the appellant failed to explain as to what were the circumstances under which the photostat copy was prepared and who was in possession of the original document at the time its photograph was taken; respondent No. 1 in his affidavit denied being in possession ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment of Patna High Court in Chaudhuri Janardan Parida and Ors. v. Prandhan Das, AIR 1940 Patna 245 (DB) observed as under: Therefore, it may be noticed that to permit secondary evidence of such a document which has been destroyed by a person in whose possession it was and in whose favour it created an enforceable legal right or an obligation is normally not to be allowed as secondary evidence. The secondary evidence of such a document may be tampered with or changed and it would be against public policy to take a chance of running the risk of fraud being committed. Besides, the destruction of the instrument may make a party liable for a contract which had either not been agreed to or had been rescinded with the destruction of document. Therefore, secondary evidence in such circumstances where document itself has been destroyed by the person in whom it created an enforceable legal right or an obligation is normally not be allowed. These observations were made in a case where the person seeking to produce the photostat copy could not explain that from where he got the photostat. A doubt was, thus, created on authenticity of the photostat copy. It was therefore observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the original or its counter-foil from which this photostat copy was prepared, was produced at the relevant time by any person in custody of such document. and the Hon ble High Court of Punjab and Haryana has laid down, the principle for admissible of evidence of photocopy of documents as under: 18. The principles culled out from the aforesaid discussion are summarized below: a) Photostat copy of a document can be allowed to be produced only in absence of original document. b) When a party seeks to produce Photostat copy it has to lay the foundational facts by proving that original document existed and is lost or is in possession of opposite party who failed to produce it. Mere assertion of the party is not sufficient to prove these foundational facts. c) The objections as to non existence of such circumstances or non existence of foundational facts must be taken at earliest by the opposite party after the photostat copy is tendered in evidence. d) When the opposite party raises objection as to authenticity of the Photostat copy its authenticity has to be determined as every copy made from a mechanical process may not be accurate. Both the requirem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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