TMI Blog2022 (3) TMI 936X X X X Extracts X X X X X X X X Extracts X X X X ..... emoval of the finished goods by M/s Sarvottam Steel Industries, based on such LRs. Cross-examination of witnesses - HELD THAT:- By not allowing Cross Examination of witness u/s 9D of Central Excise Act 1944, adjudicating authority has destroyed case of Revenue and the entire case of Revenue in remand has vitiated proceedings, making the duty demand unsustainable for violation of the Principles of Natural Justice. Except these statements of witnesses and co-noticee, there is nothing on record to establish clandestine manufacture or removal of finished goods from the Factory of Sarvottam Steel Industries. Thus, when in remand Adjudicating Authority has neither provided all documents sought by Appellants nor allowed cross examination of any of the witnesses, then, all such statements and documents need not be considered as valid evidences and consequently, duty demands based thereon deserves to be dropped in the facts of this case. Shortage of 3.275 M/T - HELD THAT:- Settled judicial view is that stock taking would be conducted in a proper manner, which should obviously be supported by some material such as, weighment slip, counting slip etc., as the case may be. It cannot b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry premises of M/s Sarvottam Steel Industries at Ahmedabad on 08.02.2011 from where they had recovered 24 LRs issued by M/s Alpesh Roadways. During Search physical stock of finished goods SS Patta Patti was found 54.570 MT as verified by shri Amrishbhai N. Patel as compared to recorded stock of 57.845 MT in RG-1 register. Thus, shortage found was 3.275 MT valued at ₹ 2,29,250/-, involving duty of ₹ 23,613/-. The inquiry was extended to transporter M/s Alpesh Roadways on 09.02.2011 during which certain other LRs were allegedly recovered. The said Transporter allegedly admitted that they had received finished goods without cover of invoices or challans. It is alleged that the main appellant had sold non duty paid goods to the appellant M/s Raghuvir Metal Industries and M/s Shri Ram Sales Corporation and accordingly, inquiry was extended at the end of said buyers at Rajkot and statement of the concerned transporters and buyers were also recorded to substantiate the charges of clandestine removal by the appellant M/s Sarvottam Steel Industries involving evasion of central excise duty of ₹ 13,53,968/-. Appellant Sarvottam Steel Industries had deposited ₹ 12,92,22 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se Appellants are in Appeal before this Tribunal. 2. Shri P.P. Jadeja, the learned Counsel appearing on behalf of the Appellants, while reiterating grounds of Appeal and submissions made during hearing has stated that Appellants have defended case against them mainly on the following submissions :- a) There was no clandestine manufacture and removal of goods, as alleged. b) There was no shortage of finished goods as shown in Panchnama dt. 08.02.2011. c) Relied upon documents for demand not provided, despite writtenrequests. d) During adjudication in Remand cross-examination not allowed in terms of Section 9D of the Central Excise Act 1944, despite such direction from Commissioner(Appeals). e) Revenue has not discharged their heavy burden to prove their case. f) Both the authorities have not carried out fact findings correctly. Hence, this Tribunal being final fact finding authority may decide the case finally in this Hon ble Tribunal. 2.1 Shri P.P. Jadeja has relied upon the following case laws :- A-For not allowing Cross Examination :- Andaman Timbers v. CCE 2015 (324)ELT-641(SC) Basudev Garg v. CC 2013(294)ELT-353(Delhi) 2017 (345) E.L.T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Umesha Textiles P Ltd Vs. CCE, Mumbai 2014 (304) ELT 591 (Tri-Mum) - S M Steel Ropes Vs. CCE, (Adj.) Mumbai 201H-TIOL-1924-HC-MAD-CX - Lawn Textile Mills P Ltd Vs. CCE, Chennai 1997 (89) EL T 646 (SC) - Surjeet Singh Chhabra Vs. Union of India 2015 (328) ELT 609 (Tri-Mum) - Saccha Saudha Pedhi Vs. CC (Import), Mumbai 2014 (309) ELT 671 (Ker) - K P Abdul Majeed Vs. CC, Cochin 2005 (189) ELT 111 (Tri-Chennai) - Singam Mark Co Vs. CCE, Saleem 2017 (313) ELT 113 (Tri-Bang) - National Boards Vs. CCE, Cali cut 2011 (269) ELT 485 (AP) - Shalini Steels Pvt Ltd Vs. CCE, Hyderabad 2017 (347) ELT 413 (Bom) - Sharad Ramdas Sangle Vs. CCE, Aurangabad 4. Heard both the sides and perused the records. I find that Appellant s Factory was searched on 08.02.2011. Excise Duty demand of ₹ 23,613/- only is on shortage of 3.275 M/T of finished goods SS Patta Patti found at the time of search as compared to the recorded stock in daily stock account RG-1 and it has been concluded in O-I-O/O-I-A that the said quantity of 3.275 M/T valued at ₹ 2,29,250/- attracting Excise duty of ₹ 23,613/- was removed clandestinely by the Appellant M/s Sarvottam Steel Indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xamination of witness u/s 9D of Central Excise Act 1944, adjudicating authority has destroyed case of Revenue and the entire case of Revenue in remand has vitiated proceedings, making the duty demand unsustainable for violation of the Principles of Natural Justice. Except these statements of witnesses and co-noticee, there is nothing on record to establish clandestine manufacture or removal of finished goods from the Factory of Sarvottam Steel Industries. Thus, when in remand Adjudicating Authority has neither provided all documents sought by Appellants nor allowed cross examination of any of the witnesses, then, all such statements and documents need not be considered as valid evidences and consequently, duty demands based thereon deserves to be dropped in the facts of this case. I find force in submissions of Appellants on this point considering ratio of the following decisions relied upon by the Appellants for not allowing Cross Examination. Andaman Timbers v. CCE 2015 (324)ELT-641(SC) Basudev Garg v. CC 2013(294)ELT-353(Delhi) 2017 (345) E.L.T. 520 (Guj.) -CCE, Ahmedabad-II vs GUJARAT CYPROMET LTD 2018 (362) E.L.T. 94 (Guj.) - BALAJI ENTERPRISE vs UOI 4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not sustainable in the law. 4.3 Thus, I find force in submissions of Appellants that in the remand proceedings, adjudicating authority has not followed judicial discipline and by not allowing cross examination of witness as sought by Appellants, the entire proceedings have been vitiated in facts of this case. In the second round of litigation, the Commissioner(Appeals) has also brushed aside submissions of Appellant by only general findings. Thus, both lower Authorities could have finally decided case appropriately as fact finding authorities on ascertaining facts and circumstances of case and appreciation of evidences on critical analysis of records correctly in order to come to rational inference and conclusion whether Appellants had indulged in alleged clandestine manufacture and/or clandestine removal of finished goods, as alleged. Submissions on behalf of Revenue reiterating findings in impugned orders does not support case of Revenue on judicial discipline of not allowing cross examination of any witness despite directions by Commissioner(Appeals) in his O-I-A No. 92 to 95/2012(Ahd-I)CE/AK/Commr(A)/Ahd dated 18-10-2012 in first round. It is quite possible that even afte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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