Customs, Excise and Gold Tribunal - Mumbai
Kirtibhai Maganbhai Patel vs Commissioner Of Central Excise on 20 September, 1999
Equivalent citations: 2003(159)ELT1162(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. In the order impugned in the appeal the Collector has held the appellant to have evaded duty on an unspecified quantity of biris manufactured by him and cleared without payment of duty, demanded duty of Rs. 323 lakhs approximately and imposed penalty of Rs. 25,000/-.
2. Advocate for the appellant raises the contention that the only evidences on the basis of which the Collector has come to the conclusion of clandestine manufacture and clearance of biris is the register seized from the premises of Dilip R. Patel, the appellant's brother-in-law. The appellant agreed with the statement of Dilip Patel that the register belongs to him (the appellant). In that register, the appellant had recorded details of kendu leaves used to roll the biris and tobacco sold by him. It cannot be inferred from this register that the appellant manufactured biris, let alone determine the quantities of such biris manufactured. Although initially the notice had alleged that the appellant got the bins manufactured through 14 persons named therein, six of them on cross-examination had denied rolling biris. The Collector had thereupon stated he did not rely upon the evidence of these persons. Therefore, he contends, there is totally insufficient evidence to hold the appellant manufactured biris and cleared. Arguments were also advanced on limitation.
3. The departmental representative contends that the entries in the register, in the manner in which they are made, do not lead to any conclusion other than that the appellant manufactured and cleared biris for which he received payments.
4. In his order the Collector has relied upon no evidence other than the entries in the register. Although initially the evidence of rollers, who alleged to have been rolled biris for the appellant was cited, some of them on cross-examination had denied rolling of biris. The Collector in his order had categorically said that he does not rely upon these evidences, evidently because these persons, on cross-examination stated that they had not rolled biris for the appellant. It is not possible for us to conclude that the records in the register establishes, to the degree of probability required by law, that the appellant had in fact manufactured biris. Most of the entries in the register do not mention biris at all. It is only occasionally that the biris figure. We must confess that it is somewhat difficult to accept whole heartedly the statement that these accounts relate to the sale of tobacco and kendu leaves by the appellant. On a question by us, the Advocate for the appellant stated that no account was maintained of the purchases of these items. It is difficult to accept that the appellant kept accounts only of sale, and not purchase of the goods. But, however suspicious these accounts are, (and they certainly are to some extent), this alone is insufficient to conclude that the appellant manufacture biris, and that too in the number specified in the notice. The matter might have been taken a different turn had proper investigations been done. As things stand, in our view, it is not prudent to rely only on the register as to establish that the appellant manufactured and cleared biris. It is settled law that clandestine removal of excisable goods justifying demand of duty must be established by sufficient evidence; (see K. Harinath Gupta v. Collector - 1994 (71) E.L.T. 980]. The degree of evidence laid down by the Courts for this purpose has not, in our view, been fulfilled by the entries in the register and at the very least, the benefit of the considerable doubt must go to the appellant. In view of this finding, we do not consider it necessary to deal with the arguments of limitation.
5. Appeal allowed. Impugned order set aside.