TMI Blog2021 (6) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... ri. Sarju Mehta Chartered Account for the Appellant Shri R K Bhashkar, Superintendent (AR) for the Respondent ORDER This appeal has been filed by Himanshu Nandlal Jagani against the imposition of penalty. In the case involving clandestine removal of goods from the factory where he had allegedly facilitated the removal. 2. Learned Counsel for the appellant pointed out that in an identical case involving the same appellant in the case of Bansal Castings Pvt Ltd tribunal s vide order No A/11554-11556/2019 dated 21.08.2019 set aside the penalty imposed as well as demand on the main appellant. He argued that the present issue is identical in nature and the case was solely made on the strength of statements. He pointed out that the primary reason for setting aside the order was lack of any evidence other than statements. He pointed out that in the said case like this case, no cross- examination was done. 3 Learned Authorized Representative argued that there is difference between the said case and this case. For this purpose he relies on the admission made by the sales manager and the authorized concern of the main noticee namely M/s Kiran Ispat Udyog. He admits that n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... signments said to have been cleared by the Appellant No. 1 without payment of duty on the basis of five transporter, we observe that in respect of two consignments, it has been mentioned by the Revenue that the same may not pertain to the Appellants. Further, only one transporter Shri Sanjay Garg of M/s. Balaji Transporter Co. was produced for cross-examination which accounts for only two consignments out of 19 consignments in question. Shri Garg, it is observed from the record of cross-examination, has deposed that they generally work as commission agent and provide transport to Appellant No. 1; the payment is used to be received directly by the drivers after delivery of the goods at the consignee s end and in case the driver did not report back for the next 3-4 days, it was presumed that the goods had reached the consignees end. Further, the name of the Applicant No. 1 on one GR No. 34 had been written not by Shri Sanjay Garg, but by his brother, whose statement has not been recorded and on GR 187, there is no mention of the name of the Appellant No. 1 at all. No statement of the drivers concerned has been recorded by the Revenue to establish that the finished goods manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew of the Tribunal that the statements of the witnesses, without allowing the assessee to test the correctness of the same by cross-examining those witnesses; cannot be made the basis for holding the allegation against the assessee. (Takshila Spinners v. CCE, supra). Similar views have been expressed by the Tribunal in the case of Haryana Petrochemicals Ltd., supra wherein the Tribunal has held that reliance cannot be placed on the documents maintained by a third party who did not have the courage to come forward for cross-examination in order to test the veracity and correctness of the private record maintained by him. It has also been held by the Tribunal in the case of Kothari Synthetics Industries v. CCE, Jaipur, 2002 (141) E.L.T. 558 (T) that entries made in the transport Register of the transport company could not be accepted as a conclusive proof of clandestine receipt of goods from that transport company for want of corroboration from any tangible evidence. Following the ratio of these decision, the duty demand cannot be upheld solely on the basis of uncorroborated statements and records of transporter. The statements tendered by the labourers can also not be relied upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand of interest. From the above decision which is based on various Supreme Court decisions, it is clear that when the brokers whose statements were recorded are not produced for cross examination such statements cannot be relied upon against the assessee. Therefore, as per the settled legal position, since in the present case witnesses, i.e. brokers and transporters were not allowed for cross examination, their statements cannot be relied upon. In such a case, the only evidence left is the diaries/private records of the brokers. Since the statements cannot be relied upon, these records in isolation has no evidentiary valued particularly when the same was not corroborated with the statutory records of the appellant. In the case of M/s Charminar Bottling Co. (P) Ltd. (supra) on the issue of third party evidence, Tribunal has observed as follow: 6. Considered the submissions of both the sides. We have the charge of clandestine removal of bags-in-boxes by the Appellants has not been established by Revenue which has mainly relied upon the difference in figures of sale of the impugned product reflected in PMX Reports. It is not disputed by Revenue that these reports are pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . U.O.I., 1978 (2) E.L.T. (J 172), the findings based on assumption and presumption without any tangible evidence will be vitiated by an error of law. We, therefore, set aside the demand on charge of clandestine removal. In view of above judgment, only on the basis of third party records, the demand cannot be confirmed alleging the clandestine removal. I also observe that despite the investigating officers recovered the diaries/ private records from the brokers no investigation was conducted to the effect who are the buyers of the goods, whether any payment was received by the appellant against the alleged clandestine removal. No effort was made to find out that whether the appellant have procured the excess raw materials to meet out the clandestinely manufactured and clearance of the goods. No excess electricity consumption was brought on record. Therefore, merely on the basis of third party evidence, that too not corroborated with any other evidence of the appellant, case of clandestine removal cannot be established. It is also observed that the appellant, Shri Atul Bansal, Director of M/s Bansal Castings has given ex-culpatory statement and he has not accepted any clandesti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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