TMI Blog2019 (1) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 17.9.2007 at the office of DGCEI were present at the appellant’s premises on 11.9.2007 at the time of search, instead of retrieving the data from the appellant premises itself, the computers as a whole have been seized and taken to the office of DGCEI. Thus, evidently, the Commissioner admits that the condition in Section 36B have not been complied with respect to the data retrieved from the computer. On such score, the evidence said to be retrieved from the computer cannot be relied upon at all. The ld. AR has argued that even though the computer print outs are not admissible in evidence, the statements of the witnesses would support the computer print outs and therefore the evidence of clandestine manufacture and clearance is established. The statements of persons have to be subjected to examination-in-chief as well as cross-examination as per the provision under section 9D of Act in order to be admissible as evidence. The statements cannot be considered as standalone documents to prove the allegations in the show cause notice. The evidence put forth is too flimsy to establish a serious charge of clandestine manufacture and clandestine clearance of goods. Though the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that the evidence relied upon by the department is the statements recorded during investigation. Though computer documents were recovered at the time of search, the procedure prescribed under Section 36B of Central Excise Act, 1944 was not complied by the department and the Commissioner himself after analyzing the provision has held that data retrieved from the computer cannot be admitted in evidence. 2.1 Entire demand of duty has been made based only on the computer print outs retrieved during investigation. The requirements of the Section 36B which are to be complied with for the purpose of relying on such Computer printouts have not been satisfied in this case. The Commissioner in Para 72 of the impugned order has categorically held that the conditions prescribed under the above Section has not been complied with and hence the computer print outs cannot be of evidentiary value. 2.2 Statements were recorded from various persons and relied upon in this proceeding to the effect that the appellant had clandestinely manufactured and cleared furniture s without payment of duty. Such statements are not admissible since the examination in chief has not been conducted by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts relied upon by the department are also not capable of proving the charge of clandestine manufacture. It has been time and again reiterated by various judicial pronouncements that the charge of clandestine removal has to be proved with cogent evidences and the demand cannot be confirmed on the basis of presumptions and assumptions. Hence, it is humbly prayed that the entire demand of duty with consequential interest and penalties (both on the appellant and the co-appellant) may be set aside with consequential relief. 3. The ld. AR Shri B. Balamurugan supported the findings in the impugned order. He adverted to para 72 of the impugned order and submitted that though the Commissioner has recorded that it would be difficult to admit the computer print outs as evidence, the statement recorded would support the computer print outs and therefore the computer print outs are not stand alone document. The print outs have been corroborated by the statements. Thus computer print outs are reliable and acceptable in evidence. Other documents viz. diary, loading list and material inward register were also recovered. These showed that appellants had purchased unaccounted wood which was used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outs of certain ledger folios as detailed in the Annexure to the mahazar dated 17.9.2007. The two hard disks contained in the computers were removed thereafter from the computers and seized under mahazar dated 17.9.2007. 5.2 Section 36B of the Central Excise Act, 1944 envisages conditions for admissibility of such date retrieved from computer. The said provision is reproduced as under:- SECTION[36B. Admissibility of micro films, facsimile copies of documents and computer print outs as documents and as evidence. - (1) Notwithstanding anything contained in any other law for the time being in force, - (a) a micro film of a document or the reproduction of the image or images embodied in such micro film (whether enlarged or not); or (b) a facsimile copy of a document; or (c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a computer print out ), if the conditions mentioned in sub-section (2) and the other provisions contained in this section are satisfied in relation to the statement and the computer in question, shall be deemed to be also a document for the purposes of this Act and the rules made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f this section, a certificate doing any of the following things, that is to say, - (a) identifying the document containing the statement and describing the manner in which it was produced; (b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer; (c) dealing with any of the matters to which the conditions mentioned in sub-section (2) relate, and purporting to be signed by a person occupying a responsible official position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it. (5) For the purposes of this section, - (a) information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate form and whether it is so supplied directly or (with or without human intervention) by means of any appropriate equipment; (b) whether in the cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mply with the provisions of Section 36B of the Act ibid and has observed as under:- In this case, it is apparent that the data contained in the computer was fed by Shri Arun from March 2006 and earlier two employees, who were no more in service maintained the computers. No statements were recorded from the said employees concerning the data and the computer print outs. Even the statement dated 27.9.2007 recorded from Shri Arun was silent as to whether the conditions stipulated in sub-section (2) as said above were complied with. In the absence of the conditions being complied with it would be difficult to admit the computer print outs as evidence in these proceedings. 5.5 Thus, evidently, the Commissioner admits that the condition in Section 36B have not been complied with respect to the data retrieved from the computer. On such score, the evidence said to be retrieved from the computer cannot be relied upon at all. The ld. AR has argued that even though the computer print outs are not admissible in evidence, the statements of the witnesses would support the computer print outs and therefore the evidence of clandestine manufacture and clearance is established. The statem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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