TMI Blog2021 (7) TMI 682X X X X Extracts X X X X X X X X Extracts X X X X ..... ments have been made through banking challans. The request for cross-examination of the persons whose statements have been relied upon has been turned down on the ground that despite several opportunities given by the Department, those persons failed to turn up before the authorities. Identical observation has been made in para 3.12 of the other adjudication order dated 15.09.2017 - the reasons assigned by the authorities below to reject cross-examination is clearly unsustainable in legal parlance for the obvious reason that no adverse inference can be drawn against assessee whose statements are to be relied by the Revenue without ascertaining the veracity in the absence of cross-examination. The Tribunal in the case of M/S NIDHI AUTO PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, NOIDA-I [ 2019 (6) TMI 899 - CESTAT ALLAHABAD] , while relying on the ratio laid down by the Hon ble High Court in the case of COMMISSIONER OF CENTRAL EXCISE, MEERUT-I, MEERUT ANOTHER VERSUS M/S PARMARTH IRON PVT. LTD., BIJNOR. [ 2010 (11) TMI 109 - ALLAHABAD HIGH COURT ] has held that when the Revenue does not allow cross-examination of any prosecution witness then Revenue cannot rely on the st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any involvement of goods. Similar Show Cause Notice (SCN) dated 08.02.2016 was issued pertaining to the period 2014-15 to deny credit availed on the strength of the excise invoices issued by the Excise registered dealers. 2.1 In the course of adjudication, the appellant disputed the duty demand on various counts and also prayed for allowing cross-examination of the persons whose statements were relied against the appellants in both the notices. Both the notices were separately adjudicated vide Order-in-Original dated 27.09.2017 and Order-in- Original dated 15.09.2017 whereby the demand proposed in the notices were confirmed alongwith interest and equivalent penalty imposed. Penalty has also been imposed on Shri Deepak Kumar Jain, Director. 2.2 The request for cross-examination was turned down with the observation that ample opportunities were given by the Department to those persons whose statements have been relied, but however, those persons failed to turn up before the Adjudicating authority. It has also been observed in the adjudication order that it could not be ruled out that the appellant had an understanding with those persons for not appearing for cross-examination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods which have been used in the manufacturing process and necessary accounts and statutory records under Central Excise have been duly maintained. He also submitted that payment has been duly made through banking channels and there is no evidence that the payment has been received back so as to dispute the authenticity of the transaction. He stated that the said submissions were also made in the course of adjudication which have not been refuted by the authorities. He also submitted that since the CENVAT credit has been lawfully availed, there is no reason to impose any penalty on the Company as well as the Director. 5. The learned Authorized Representative, appearing for the Revenue, justified the findings made in the impugned orders and stated that there is no case for the appellant to seek any relief inasmuch as the credit has been illegally availed without receipt of excisable goods as would be evident from the proceedings initiated by the DGCEI, Jamshedpur against the concerned manufacturers and the dealers on whose invoices the CENVAT credit have been illegally claimed by the appellant. He accordingly prayed that all the appeals be rejected being devoid of any merit. 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Tri) has observed that:- 8 . Considered. It is not in dispute that the entire case of the Department regarding the gate passes in question being fictitious hinges on the evidence of the Partner/Director of the concerned firm of Alang (Rajkot), who according to the gate passes resumed in the instant case were consignors. From the Final Order (as extracted above) No. A/245/92-NRB, dated 25-5-1992 passed by the Tribunal, it is clear that, earlier the case was remanded to the adjudicating authority for affording an opportunity to the appellants to cross-examine the concerned persons whose statements were relied upon in the Show Cause Notice. We find from the impugned Order that still the opportunity to cross- examine the witnesses whose statements were relied upon in the Show Cause Notice was not given to the appellants. The adjudicating authority, that is to say, the Additional Collector of Central Excise, Chandigarh, has recorded his finding in paragraph 4 of the impugned order-in-original as follows : 4. Personal hearing along with cross-examination of the witness, whose statements were relied upon in the Show Cause Notice, was fixed for 27-10-1992, 9-11-1992, 12-12- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion. The Adjudicating authority again in the finding column in the impugned order has observed as under : The opportunity by cross-examination of the witnesses also was given.But the persons summoned to appear forcross-examination before me did not turn up. It was explained to Counsel L.Chandrasekaran that the persons summoned for cross-examination appeared to keep away from their proceedings and as such the adjudication process will not be completed. 6. 10. Besides, the case of Pahar Chand Sons v. The State of Punjab, (1972) 30 STC 211, decided by the Division Bench of the Punjab Haryana High Court (cited by the appellants in the memo of appeals) also applies on all fours to the present case. In that case also, the Sales Tax Assessing Authorities under the Sales Tax Act were treating the sales recorded in the books of accounts as fictitious and the assessing authorities relied upon the testimony of the witnesses without giving opportunity of cross-examination to the assessee therein. Setting aside the assessment, the Court observed (1) that if the assessing authority was relying on the testimony of a witnesses, the assessee should have been af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statements were admissible evidence in the present case. We, further, note that it is settled law that if the author of a diary is not identified and his statement is not recorded then such diary is not admissible evidence. In the present case, we find that the author of the diary recovered at the residence of the partner of M/s. Ruby Steels was not identified and his statement was not recorded and therefore, the diary recovered was not admissible evidence. Further, we also note that it was alleged that M/s. Nidhi Auto was maintaining parallel ledgers whereas we find that M/s. Nidhi Auto was maintaining two ledgers which was in the regular course of business and that the goods entered were tallying with the total quantity received by them in both the ledgers put together. Further, Revenue could not exhibit any discrepancy of total inputs reflected in two ledgers put together with entries of inputs in RG-23 records. Further, we note that Revenue has not investigated as to if 9112.500 MT of quantity of inputs shown in the books of account of M/s. Ruby Steels were not delivered to M/s. Nidhi Auto and only invoices were given then where did such huge quantity of inputs gone and to whom ..... 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