TMI Blog2019 (11) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... t by the counsel for appellant about the procurement of the documentary evidences like a kutcha receipt of sale from the computer which was found in custody of Mr. Sahu. There is already an appreciation of facts done by CESTAT while pointing out that this appellant has failed to prove the production of SS Ingots, sale of SS Ingots and procurement of the raw material. So far as procurement of the raw material is concerned, there is no convincing evidence on record, as stated by CESTAT which requires interference by CESTAT to the Order-in-Original dated 10th October, 2013 and therefore, we see no reason to re-appreciate those evidences on record. This appellant has failed to prove the clandestine removal of the final product. Even otherwise, all the arguments of this appellant is based upon re-appreciation of the evidence by the CESTAT. The CESTAT is the final fact finding authority, and in matters such as this, an appeal lies, from the final order of the CESTAT, to this Court, only on substantial questions of law. Matters involving appreciable evidence ordinarily, would not involve substantial question of law, as this Court, in exercise of its powers conferred by Section 35H o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nion to support its finding that, with one control panel, could both the furnaces simultaneously produce Stainless Steel Ingots. 4. The relevant portion of paras 9 to 11 of the aforesaid final order dated 28th September, 2011 , of the CESTAT, may, in this context, be useful to reproduce as under: 9. We have gone through the detailed submissions from both the sides and perused the records. We are of the view that prima facie the Commissioner did not observe the principles of natural justice and gave certain findings, especially, on the capacity of production, without giving fair opportunity to the parties. We do not agree with the findings of the Commissioner, wherein, he has justified the refusal of grant cross-examination of various co-noticees and others. A Co-noticee has a right to refuse cross-examination. But when no such refusal was made, Commissioner should not have rejected cross-examination on his own. Although, we agree the submissions of the authorized representative that cross-examination is not a matter of right, the same would, however, depend upon the facts of each case. We find that in the present batch of appeals, the whole case of the Revenue is b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction capacity of M/s. Jindal. 9.1 With regard to production capacity of M/s. Jindal, we agree with the learned counsel s submission that the Commissioner has not properly appreciated the facts available on record. The Commissioner has erroneously proceeded to hold that M/s. Jindal had the capacity to manufacture the SS Ingots, which were allegedly sent to the four re-rollers for conversion into SS Flats, on which, he has confirmed the duty demand. He was supposed to determine the capacity on the basis of invoice of the supplier of the furnaces or by obtaining the expert opinion. No technical opinion has been brought on record in support of his finding that with one control panel both the furnaces simultaneously were capable of producing SS Ingots. We have also gone through the Panchnama, dated 22.11.2007 (RUD No. 1) drawn at the factory premises of M/s. Jindal. It has clearly been noted therein that they had only one transformer available in their factory on the date of visit of the officers in their factory. The officers made no attempt to find out the production capacity of M/s. Jindal. They did not record any statement of production staff to find out the said capacity. N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, transporters, re-rollers cutters and buyers of SS Flats. In the first place, except scrap dealers and buyers of SS Flats, all others have been made co-noticees in the present case. It is well settled law that evidence of one of co-noticee cannot be relied upon against another co-noticee, unless it is corroborated by independent evidence. Further, merely because incriminating oral evidence is recorded the same is not sufficient to establish a serious charge of clandestine production and removal of excisable goods. Further, these statements have yet to be tested on cross-examination. We are, therefore, of the view the actual scenario would be clear only when the witnesses/co-noticees are cross-examined and actual production capacity of M/s. Jindal is examined by the learned Commissioner. 9.3 We also, prima facie, agree with the submissions of the learned counsel that computer printouts are hit by the provisions of Section 36B(2) of the Central Excise Act. The genuineness of other loose slips is required to be established with corroborative evidence. 9.4 The learned counsel has strenuously argued that the duty demand on SS Flats is misdirected against them as they have ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 108. As per the CESTAT directions, Central Excise authorities, those who booked and case were requested to offer their comments on the following issues raised in para 9.1 of the Hon ble CESTAT order. i. No technical opinion has been brought on record in support of the finding that with one control panel both the furnaces simultaneously were capable of producing SS Ingots. ii. Also no attempt was made to find out the production capacity of M/s. Jindal Nickel Alloys Ltd. and to match the actual production with electricity consumption and fuel consumption. iii. The Commissioner had also not controverted or displaced the evidence furnished in the Chartered Engineer s Certificate dated 01.07.2008 furnished by M/s. Jindal Nickel Alloys Ltd. 109. They submitted the para-wise comments on the points referred points which inter-alia reads as under: Para (i) The issue had been adequately dealt in paras 106.2 106.3 of the Order-in-Original No. 60/PKJ/CCE/Adj/09 dated 9-12-2009 and it was observed that Dual Track Induction Power and Control unit permitted use of both the crucibles. The catalogue of M/s. Inductotherum (India) Pvt. Ltd. Clearly mentioned t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h according to it was based on assumptions as it was not duly substantiated by documentary evidences. Therefore, it had remanded back the case and directed to re-determine the production capacity and therefore the concerned authorities were further requested to offer specific comments in the matter. Subsequently, they furnished a reply which inter-alia reads as under: I. The basis of production capacity determination of ingots by M/s. Jindal Nickel Alloys was derived from the data fed into the computer by Shri Sushant Kumar Sahu, Accountant on the basis of kacha parchis provided by Shri. Ashwani Jindal, Director of the firm and not on technical aspect whether one control panel can support the working of both the furnaces simultaneously. This fact was corroborated by the voluntarily statement made by Shri. Mangat Rai, Director of the firm under section 14 of the Central Excise Act, 1944 dated 25-4-2013. Therefore no technical opinion was warranted. II. Productive capacity of the party was based upon the investigations conducted in the case and as arrived at after taking on record the admissions made by Sh. Mangat Rai, Director and other of the firm, who was responsible f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tch the actual production with electricity consumption and fuel consumption so that Chartered Engineers certificate supplied by the party can be countered. Further, the Chartered Engineer had determined the annual production capacity considering that M/s. Jindal steels were working only for one shift. As such evidence was to be placed on record that M/s. Jindal Steels were working for more than one shift. Further comment whether five transformers were installed in the factory premise of M/s. Jindal Nickel Alloys ltd. on 22.11.2007 or only one transformer was installed as mentioned in the CE certificate/Panchnama to controvert the CE certificate. But no supportive comments could be furnished by the department. 111.1 On going through the Panchnama, dated 22.11.2007 drawn at the factory premises of M/s. Jindal, it was clearly noted therein that they had only one transformer available in their factory on the date of visit of the officers in their factory. The officers made no attempt to find out the production capacity of M/s. Jindal. They did not record any statement of production staff to find out the said capacity. No statements of any employee/worker were recorded to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce. Further, merely because incriminating oral evidence was recorded, therefore in the absence of substantial documentary records, the same was not sufficient to establish a serious charge of clandestine production and removal of excisable goods. It was contended that the computer printouts were hit by the provisions of Section 36B(2) of the Central Excise Act as the computer from which the printouts were taken was not in the control of M/s. Jindal. The genuineness of other loose slips was required to be established as the scribe of them could not be identified. However, no substantive evidences were provided to corroborate the genuineness of the same. The investigation officers had seized some records from the residence of Shri S.K. Sahu and subsequently retrieved the computer printouts and concluded that quantity of the ingots which found mention in the said records were manufactured in the factory of the notices. The department was required to prove that what was source of procurements of Ingots to enable the Re-Rollers to manufacture a quantity of around 11125.7555 MT quantity of SS Flats. There could be a possibility that in the absence of notice having requisite facility to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been clearly stated that only one crucible can be used for production at a time and not both. This clearly proves that the Revenue s projection of the production capacity is hugely inflated. 7. M/s. Jindal has been sending S.S. Ingots/flats to their rerollers and cutters for manufacture of S.S. Flats on job work basis under Notification No. 214/86. In respect of such ingots, M/s. Jindal had also discharged the duty payable on the S.S. Flats cleared directly to customers from the premises of job workers. In this regard, we find that the claim of M/s. Jindal is reasonable inasmuch as they are not liable for payment of excise duty on the quantity of S.S. Flats cleared by the job workers, over and above the quantity manufactured making use of the ingots received from the appellant on job work basis. In this regard we sustain the findings of the adjudicating authority. 8. Computer print outs were retrieved from the residence of sh. S.K. Sahu during the search. M/s. Jindal has claimed that such documents are not admissible as evidence since the conditions specified in Section 36B have not been satisfied. The conditions specified therein are that the CPU was under the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CESTAT, several aspects of the matter have already been settled by CESTAT, New Delhi. There is no appeal preferred by the Department against the order dated 28th September, 2011 passed by CESTAT. 13. Counsel for the appellant submitted that certificate of the Chartered Engineer was obtained after the premises was searched. This argument is of no help to the appellant because the capacity of the furnace has nothing to do with the date of raid. If there is a particular capacity of the furnace, the same remains as it is even prior to the search and after the search also. 14. Thus, this appellant has failed to prove the clandestine removal of the final product. Even otherwise, all the arguments of this appellant is based upon re-appreciation of the evidence by the CESTAT. The CESTAT is the final fact finding authority, and in matters such as this, an appeal lies, from the final order of the CESTAT, to this Court, only on substantial questions of law. Matters involving appreciable evidence ordinarily, would not involve substantial question of law, as this Court, in exercise of its powers conferred by Section 35H of the Act, is not empowered to re-appreciate evidence, which has al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cess information for the purposes of any activities regularly carried on over that period by the person having lawful control over the use of the computer; (b) during the said period, there was regular supply to the computer in the ordinary course of the said activities, information of the kind contained in the statement or of the kind from which the information so contained is derived; (c) throughout the material part of the said period, the computer was operating properly or, if not, then any respect in which it was not operating properly or was out of operation during that part of period was not such as to affect the production of the document or the accuracy of the contents; and (d) the information contained in the statement reproduces or is derived from information supplied to the computer in the ordinary course of the said activities. 16. There is nothing to indicate compliance with the strict stipulations contained in subsections (1) and (2) of Section 36B of the Act in the present case. We, therefore, find no reason to interfere with the findings of the CESTAT regarding non-compliance of Section 36B of the Act either. 17. We found no perversity of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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