TMI Blog2021 (1) TMI 708X X X X Extracts X X X X X X X X Extracts X X X X ..... December 2015 so as to allay any possibilities of tampering. It is also forthcoming from the case records that most of the printouts from the Pen drives were taken after conclusion of Panchnama proceedings. There is considerable force in the contention of the Appellants that the computer printouts relied upon to uphold the charge of clandestine clearance were not obtained in conformity with the mandatory conditions and safeguards laid down in Section 36B(2) (4) of the Central Excise Act, as these were not produced by a computer which was being used regularly to store or process the information during the period in dispute and Certificate referred to Section 36B(4) of the Central Excise Act was also not obtained. Even the statement of Appellant No. 2 could not be admitted as evidence being not in accordance with the procedure prescribed under clause (b) of section 9D(1)of the Central Excise Act. It is also found from the case records that the printouts from the Pen drives are neither co-relatable with the central excise invoices raised by the Appellant during the relevant period nor corroborated by any independent evidence establishing clandestine manufacture or clearance. N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Appellant No. 1 is also a Proprietor of M/s. Radhagopi Auto Industries and a Director in M/s. Maa Bhagwati Rerolling Mills Pvt. Ltd. On 3-08-2012, Officers of DGCEI conducted simultaneous search operations at the factory-cum-office premises of Appellant No.1, residence of Appellant No. 2 and the offices of the other business concerns related to Appellant No. 2. Pursuant to the search proceedings, DGCEI officials seized 1 Laptop and 4 Pen drives from the residence of Appellant No. 2 in presence of wife and nephew of the Appellant No. 2. The Appellant No. 2 was thereafter, summoned to appear at the factory premises of the Appellant No. 1 wherein Panchnama proceedings were concluded at 6 P.M. on the same day. The data available on 4 Pen drives was partly printed before conclusion of search proceedings and the signature of the Appellant No. 2 was obtained on the 35 pages so printed. The officials returned in the mid-night of 03-08-2012 to obtain signature of the Appellant No. 2 on the balance printouts running into more than 400 pages and recorded the statement of Appellant No. 2 followed by recording of further statements on 2 July 2013 and 1 October 2013 eventually culminating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid charge. B. Computer Print outs relied upon in the order dated 22 July 2016 are not admissible as an evidence in as much as, (i) the requirements of Section 36B(2) (4) of Central Excise Act, 1944 were not complied with. Reference in this regard has been placed on the following decisions: Bihar Foundary Castings Ltd. vs. CCE, Ranchi [2019 (8) TMI 527 CESTAT Kolkata] Para 24; Popular Paints and Chemicals vs. CCE, Raipur [2018 (8) TMI 473 CESTAT New Delhi] Para 15.2 Premium Packaging Pvt. Ltd. vs. CCE, Kanpur [2005 (184) ELT 165 (Tri. Del.) Para 5 (ii) The computer printouts save and except 35 pages were taken after conclusion of panchnama proceedings. In majority of the printouts the time is after 6 p.m. i.e. after conclusion of panchnama proceedings. Reference in this regard has been invited to the judgment of the Tribunal in the case of Modern Laboratories vs. CCE, Indore [2017 (358) ELT 1179 (Tri. Del.)] Para 16. C. Alleged Sales Ledger could not have been relied upon by the learned Commissioner because of the following reasons: (i) None of the entries in the Sales Ledger were matching with the Central Excise Sales Invoice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reference in this regard is invited to the Tribunal s decision in the case of Modern Laboratories vs. CCE, Indore [2017 (358) ELT 1179 (Tri. Del.)] Para 16 and Para 19; E. Statement of Appellant No.2 could not be relied upon for the following reasons, (i) the same stood retracted vide affidavit dt. 11-01-2016. It is a trite law that delay in retraction cannot be a ground for disregarding the same. Reliance in this regard is placed on the decision of Parle Beverages Pvt. Ltd. vs. CCE, Bombay [1998 (98) E.L.T. 585 (S.C.)] Para 1, wherein it has been held that delay in filing of affidavit cannot be a ground for completely bruishing aside the same. (ii) The statements of Appellant No.2 was contradictory which stands acknowledged in para 3.3 of SCN itself. (iii) The statements of Appellant No.2 has not been admitted in evidence in accordance with the procedure prescribed in clause (b) of Section 9D(1) of Central Excise Act, 1944. Reliance in this regard is placed on the following judgments: Ambika International v. Union of India [2018 (361) E.L.T. 90 (P H.)] Para 25; G-Tech Industries v. Union of India [2016 (339) E.L.T. 209 (P H.)] Para 16 M/s. Am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old the charge of clandestine clearance were not obtained in conformity with the mandatory conditions and safeguards laid down in Section 36B(2) (4) of the Central Excise Act, as these were not produced by a computer which was being used regularly to store or process the information during the period in dispute and Certificate referred to Section 36B(4) of the Central Excise Act was also not obtained. The decision of the Tribunal in the case of Popular Paints reported (supra) fully supports the contentions of the Appellants on this point and the relevant paras 14 to 15.5 of the said decision have been extracted below. 14 . We hold that computer printouts cannot be held to be admissible evidence unless the conditions as laid in the provisions of Section 36B of the Central Excise Act are fully complied with. A perusal of section 36B would indicate that the Act has prescribed very stringent conditions for computer printouts to be a piece of admissible evidence. The Ld. Counsel for the appellants has invited our attention particular to provisions of Section 36B(2) and (4) of the Central Excise Act. For the better appreciation of facts, it is relevant to cite Section 36B of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioned in clause (a) of sub-section (2) was regularly performed by computers, whether- (a) by a combination of computers operating over that period; or (b) by different computers operating in succession over that period; or (c) by different combinations of computers operating in succession over that period; or (d) in any other manner involving the successive operation over that period, in whatever order, of one or more computers and one or more combinations of computers, all the computers used for that purpose during that period shall be treated for the purposes of this section as constituting a single computer; and references in this section to a computer shall be construed accordingly. (4) In any proceedings under this Act and the rules made thereunder where it is desired to give a statement in evidence by virtue of 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 tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in MANU/S/0834/2014 wherein in paragraphs 13 to 17 it has been held as under:- 13. Any documentary evidence by way of an electronic record under the Evidence Act, in view of Sections 59 and 65A, can be proved only in accordance with the procedure prescribed under Section 65B.Section 65B deals with the admissibility of the electronic record. The purpose of these provisions is to sanctify secondary evidence in electronic form, generated by a computer. It may be noted that the Section starts with a non obstante clause. Thus, notwithstanding anything contained in the Evidence Act, any information contained in an electronic record which is printed on a paper, stored, recorded or copied in optical or magnetic media produced by a computer shall be deemed to be a document only if the conditions mentioned under sub- Section (2) are satisfied, without further proof or production of the original. The very admissibility of such a document, i.e., electronic record which is called as computer output, depends on the satisfaction of the four conditions under Section 65B(2). Following are the specified conditions under Section 65B(2) of the Evidence Act: (i) The electronic record con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch safeguards, the whole trial based on proof of electronic records can lead to travesty of justice. 17. Only if the electronic record is duly produced in terms of section 65B of the Evidence Act, the question would arise as to the genuineness thereof and in that situation, resort can be made to Section 45A opinion of examiner of electronic evidence. 18. The Evidence Act does not contemplate or permit the proof of an electronic record by oral evidence if requirements under Section 65B of the Evidence Act are not complied with, as the law now stands in India. 15.2 Thus, it has been clearly laid down by the Supreme Court that the computer printout can be admitted in evidence only if the same is produced in accordance with the provisions of Section 65B (2) of the Evidence Act. A certificate is also required to accompany the said of computer printouts as prescribed under section 65B(4) of Evidence Act. It has been clearly laid down in para 15 of this judgment that all the safeguards as prescribed in Section 65B (2) (4), to ensure the source and authenticity, which are the two hallmarks pertaining to electronic record sought to be used as evidence. Electronic r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant is duly supported by the decision of the Punjab and Haryana High Court in the Ambika International Case (supra). 7. We also find from the case records that the printouts from the Pen drives are neither co-relatable with the central excise invoices raised by the Appellant during the relevant period nor corroborated by any independent evidence establishing clandestine manufacture or clearance. No efforts have been made by the investigating agencies to establish the existence of any unaccounted manufacturing activity in the form of unaccounted raw material, shortage of stock, shortage of raw material/finished goods, excess consumption of electricity, unaccounted labour payments, interrogation of buyers/transporters or any incriminating record/document to suggest any flow back of cash etc. The revenue authorities in this case have failed to discharge the burden of proving the serious charge of clandestine clearance or undervaluation with cogent and clinching evidence. It has been consistently held that no demand of clandestine manufacture and clearance can be confirmed purely on assumptions and presumptions and the same is required to be proved by the revenue by direct, af ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
