Custom, Excise & Service Tax Tribunal
M/S Shree Gajanan Paper & Boards Pvt. ... vs Commissioner Of Central Excise And ... on 12 January, 2018
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Zonal Bench, 2nd Floor, Bahumali Bhavan, Asarwa, Ahmedabad Appeal Nos. E/11686 to 11688/2013 (Arising out of Order-in-Appeal No. SRP/240-242/DMN/2012-13 dated 19.03.2013 passed by the Commissioner (Appeals), Central Excise & Service Tax, Gujarat) M/s Shree Gajanan Paper & Boards Pvt. Ltd., Sunil M Agrawal, Shashikant Bhaviskar ..Appellant(s) Vs. Commissioner of Central Excise and Service Tax, Daman ..Respondent(s)
Appearance Shri S.J. Vyas, Advocate for the Appellant.
Shri N. Nagori, (AR) for the Respondent.
Coram:
Honble Mr. M. V. Ravindran., Member (Judicial) Date of hearing: 12/01/2018 Date of decision: 12/01/2018 FINAL ORDER No. 10360-10362/2018 [Order per: M. V. Ravindran.] These three appeals are contesting Orders-in-Appeal No. SRP/240-242/DMN/2012-13 dated 19.03.2013.
2. The relevant facts are factory premises of Shree Gajanan Paper & Boards Pvt. Ltd., (main appellant) were visited by the officers and on completion of investigation concluded that there is clandestine removal of the goods i.e., M.G. Kraft paper. During the investigation statements were recorded of the personnel from the factory, purchasers and shortage of inputs was noticed. Show cause noticed was issued for demand of the duty on such clandestine removal. The Adjudicating Authority after following due process of law, and confirmed the demands with interest and imposed equivalent amount of penalty on the main appellant; penalties on two individuals, besides confiscating the goods and imposing redemption fine in lieu of such confiscation. On the appeals filed by the appellants, the First Appellate Authority upheld the confirmation of duty, interest and penalty imposed on the main appellant, set aside the confiscation of the goods consequently redemption fine imposed, and reduced the penalties on the individuals.
3. Learned Counsel draws my attention to the entire case records takes me through the Order-in-Original and the Order-in-Appeal. It is his submission that except for the recovery of the diary and the statement of the individual from the factory of the main appellant there is no corroborative evidences. He would submit the statements given by the purchasers are categorically recorded that they have not purchased/received the goods alleged to have been sold to them without duty paying documents. It is his submission the effect of buyers denying purchase is that the diary is not reliable document showing correct details. Therefore, the diary cannot be relied upon. It is his submission that in the absence of any corroborative evidences in the form of unaccounted purchase of utilities the mode and flow back of money from the purchasers, the allegation of clandestine removal cannot be made against the appellants. He relies upon the recent judgment of the Honble High Court of Rajasthan in a similar situation in the case of CCE, Jaipur Vs. Tara Chand Narash Chand [2018 (1) TMI (209)] wherein it was held that only on the basis of statement the case cannot be sustained.
4. Learned Departmental Representative reiterates findings of the Lower Authorities.
5. On careful consideration of submissions made, I do find that the Adjudicating Authority as well as the First Appellate Authority has not considered the factual aspect of the case in its correct perspective, come to a conclusion based upon only the statement of authorized signatory and Managing Director and diary as evidences which recorded that clearances were made without payment of duty.
5.1 Firstly, I find that the statements of the buyer on which reliance was placed in the show cause notice, do not indicate they have received the Kraft paper from the main appellant herein without any document. In the absence of such findings supporting the allegation or corroborative evidences, the allegation of clandestine removal in the case is unsustainable.
5.2. Secondly, I find that there is no further investigation under taken by the authorities to bring on record any unaccounted purchase of raw materials, unusual consumption of utilities during the period in question. It is correctly pointed by the Learned Counsel that for clandestine removal of the goods there has to be manufacture in the factory premises. I find that the issue is squarely covered by the judgment of the Tribunal in the case of Saakeen Alloys Pvt. Ltd., [2014 (308 ELT 655] & Vishwa Traders Pvt. Ltd., [2012 (278) ELT 362] which is upheld by the Honble High Court and the further upheld by the Apex Court as reported at [2014 (303) ELT 824].
6. I find strong force the submissions made by the Learned Counsel that recent judgment of Honble High Court of Rajasthan in the case of Tara Chand Naresh Chand holds the same view following the judgment in the case of Omkar Textile Mills Pvt. Ltd., [2010 (8) TMI 322] and other decisions.
7. In the absence of any corroborative evidences that supports the allegation of clandestine removal relying only on statements of the managing director for confirmation of demand is not in consonance of law, I find that the ratio of the above decisions squarely covers the issue in favour of the appellants herein. Respectfully following the same, I hold that the impugned order is unsustainable and liable to be set aside and I do so. The impugned order is set aside and the appeals are allowed with consequential relief, if any.
(Operative part of this order was pronounced in open court on conclusion of hearing) (M. V. RAVINDRAN) MEMBER(JUDICIAL) Lakshmi.
Appeal Nos. E/11686-11688/2013 1 1