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2019 (8) TMI 315

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..... allowances say 15%, is given for error or variation, as the stock taking was done in a hurried manner. Parallel invoices - HELD THAT:- In the course of verification of the alleged buyers / receiver of the goods before the Commissioner (Appeals), Shri A. K. Malhotra, Director of M/s Rathi Steel Dakshin Limited stated that his statement was taken under pressure. Further, he had already retracted his statement vide letter dated 02.08.2017. the other alleged buyers, were not examined by the Revenue in adjudication proceedings. Demand based on the weighment slips, recovered during the course of search - HELD THAT:- The Director of the appellant has given a plausible explanation, that they also weighed the goods of outsiders on their weighbridge and such weighment slips pertain to outsiders material. Such plausible explanations have not been found to be untrue. There is also no proof to establish clearance of goods under the weighment slips whatsoever. Hence, it is held that the demand based on the weighment slips is only presumptive or fictional and not based on any material evidence, and hence the same is set aside. Valuation of the alleged shortage of stock - HELD THAT:- It .....

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..... es. A physical stock verification report was prepared on the spot and signatures of Sh. Anshul Aggarwal, erstwhile Director of the unit, Sh. Nitish Ranjan, then Authorised signatory of the Appellant and the two independent witnesses, were taken on the said report. The weighment slips, records invoices of the relevant period and photocopy of the relevant page of RG-1 register were resumed under resumption memo. 4. The officers conducted the physical verification of the stock of the appellant, within a period of 4 hours and 30 minutes, wherein they concluded that there is a shortage of 128.435 MT of MS Ingots. 5. It further appeared that the Appellant had clandestinely removed the MS Ingots on the basis of three invoices having no.017/20.07.2011 issued to M/s Rathi Special Steel, Ltd, Khushkheda, Bhiwadi and invoices no. 019/29.07.2011 and 020/29.07.2011 issued to M/S Rathi Steels Ltd. (Dakshin), Khushkheda, Bhiwadi. On the scrutiny of the statutory records of the Appellant, it was noticed that the above mentioned three invoices were not mentioned therein. It was concluded that the same were parallel invoices used for the clandestine removal of MS Ingots w .....

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..... 12 7 dt. 30.07.12 8 dt. 30.07.12 6073 5277 1346 17000 22390 28010 Total 208980 7. On the basis of the investigation, the officers concluded that the Appellant had removed the following quantities under the heads as shown herein below: S. No. Evasion through Qty. (in MT.) Value (in Rs.) BED (in Rs.) Ed. Cess (in Rs.) B.Ed. Cess (in Rs.) Total duty (in Rs.) 1 Parallel invoices issued vide No. 17 dt. 20.07.2011 and invoice Nos. 19 and 20 both dt. 29.07.2011 84.75 25,60,054/- .....

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..... t before the Officers on the day of search stated that these slips were given to him by Shri Nitish Ranjan, Authorised Signatory and he was supposed to return the same to him. Further, Shri Nitish Ranjan, AS, in his statement dated 31.07.2012 admitted the shortage in the stock of finished goods and further admitted that the clearances of goods mentioned on the weighment slips were not recorded nor invoices issued. Further, the three invoices No. 17 dt. 20.07.2011, 19 20 dt. 29.07.2011, alleged to be parallel invoices, were brought by the Department. He admitted that these are not entered in the statutory records and they were ready to deposit the Central Excise duty. Shri Nitish Ranjan also admitted that parallel invoices No. 17 dt. 29.07.2011 bears his signature. He further stated that Vehicle Nos. HR 69 9696 and HR 46C 2733 belong to their company M/s RIPL. Shri Anshul Agarwal, Director of M/s RIPL in his statement dated 31.07.2012 agreed in his statement to the admission made by Shri Nitish Ranjan. Shri Anshul Agarwal also admitted that parallel invoices No. 19 dt. 29.07.2011 was pre- authenticated by him. Shri Anshul Agarwal also stated that he looked after the entire work re .....

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..... bove documents as the same was used for production of MS Ingots procured under the above documents, as the same was used for production, without entering in their statutory records and clearances thereof. They vide letter 1.8.2012 submitted a copy of e-payment receipt of ₹ 6,85,701/-. 13. The officers visited factory premises of M/s Shri Rathi Special Steel Limited, SP-27 F-20-24, RIICO Industrial Area, Khushkhera, Bhiwadi on 1.8.2012 Sh. Sarjeet Yadav, Authorised Signatory in his statement dated 1.8.12 inter-alia stated that they were engaged in the manufacture of TMT Bar for which they procured M.S. Ingots from various manufacturers. Having seen the copy of invoice No. 17 dated 20.07.2011 issued by M/s RIPL wherein 28.210 MT MS Ingots valued ₹ 8,51,942/- has been shown dispatched to them, he admitted to have received the goods mentioned in this invoice. He admitted that this consignment was not, entered in their statutory records as the same was received without cover of Central Excise invoice. Further after admitting the receipt of MS Ingots without entering the same in the statutory records, he stated that he was ready to deposit Central Excise duty o .....

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..... a demonstrable degree. It was observed that from the overall facts and circumstances of the case the allegation of clandestine removal stands proved against the appellant. Being aggrieved, the appellants are before this Tribunal. 16. Learned Counsel for the appellants urges that the physical stock taking of huge stock of finished goods, purported to have been conducted within a short span of about four hours, is impossible and hence the authenticity is questionable. The stock taking was done without adopting fair and realistic method and the Revenue authorities adopted pressure and undue influence on the personnel of the appellant company to agree to the stock verification as drawn by them. 17. With regard to the parallel invoices the same were not recovered from the appellant premises and hence there is no connection between the documents and the appellants. Further, disowning the said parallel invoices the appellant further urges, that even assuming without admitting the veracity of the documents, there is no proof with the Department with respect to the production, clearance or realisation of sale proceeds and hence the same should be discarded for wan .....

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..... authority in this regard. Thus, the alleged shortage of finished goods if held to be correct, but there needs to be some allowances say 15%, is given for error or variation, as the stock taking was done in a hurried manner. 21. Coming to the second issue of three parallel invoices, nowhere from the record it emerges from where such documents were recovered from or received. In the course of verification of the alleged buyers / receiver of the goods before the Commissioner (Appeals), Shri A. K. Malhotra, Director of M/s Rathi Steel Dakshin Limited stated that his statement was taken under pressure. Further, he had already retracted his statement vide letter dated 02.08.2017. the other alleged buyers, were not examined by the Revenue in adjudication proceedings. 22. With regard to the third issue, namely the demand based on the weighment slips, recovered during the course of search, the Director of the appellant has given a plausible explanation, that they also weighed the goods of outsiders on their weighbridge and such weighment slips pertain to outsiders material. Such plausible explanations have not been found to be untrue. There is also no proof to est .....

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