TMI Blog2009 (2) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... ust to find clandestine clearances and evasion, in the instant case the revenue has not been able to substantiate its case with concrete evidence – demand set aside - E/406-407/2006 - 147-148/2009 - Dated:- 6-2-2009 - Shri P. Karthikeyan, Member (T) Shri G. Natarajan, Advocate, for the Appellant. Shri M.K.A.K. Mohiddin, JDR, for the Respondent. [Order].- Investigation into the transactions of terry towel manufacturers M/s. Jaisar Spintex Pvt. Ltd., Sankarankoil, (Jaisar), M/s. Peeyelcee Tex Exports Pvt. Ltd., Sankarankoil (PTE) and a sizing mill M/s. Sri Muthu Industries, Sankarankoil revealed that M/s. Ganga Parameswari Spinners Pvt. Ltd., (GPS), Rajapalayam had apparently cleared 10's cotton yarn on cheese to the above ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... book recovered from Sri Muthu Industries had shown receipt of cone yarn from GPS. The Managing Director of GPS admitted in his statement dated 22-9-03, that they had removed cheese yarn from GPS without payment of duty in the guise of hank yarn. He ignored the depositions of S/Sh. J. Laxmanan, and C. Saravanan during their cross-examination by the counsel for GPS as of no consequence. As hank yarn could not be used in the manufacture of terry towels, he concluded that the allegation of clearances of cheese yarn in the guise of hank yarn by GPS was established as well as of the informed involvement of Shri R.P. Laxmanaperumal in the offending transactions. In the impugned order, the Commissioner (A) affirmed the order of the original authori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e note books or the statement of Shri C. Saravanan were therefore not reliable to find allegations against the appellants. Shri C. Saravanan was in no way connected with Sri Muthu Industries himself. The mill was run by others during the material period. His statement therefore lacked evidentially value. GPS had facility to manufacture hank yarn and did not have cone winding machine. They had only open ended machine with which cheese yarn only could be manufactured. 4. Clandestine clearances had to be established comprehensively by adducing evidence of consumption of electricity, receipt of sale proceeds etc. The un-corroborated statement of Shri R.P. Laxmanaperunal alone could not be relied on as evidence of clandestine clearances. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rankoil. S/Sh. J. Laxmanan and C. Saravanan are witnesses whose statements recorded under Section 14 of the Act are acceptable evidence. However, I find that Shri C. Saravanan gave contradictory versions as to the yarn received from GPS during cross-examination. Initially he had stated that PTE had received yarn on cones from GPS. During cross-examination also, he deposed initially that PTE had received yarn on cones from GPS. When it was pointed out by the appellants that GPS did not have machinery to manufacture cone yarn, he corrected his deposition and stated that GPS had sent cheese yarn. There is no record of legal recovery of the sizing and wrapping note books from Sri Muthu Industries; there is no mahazar or witness. Moreover, the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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