Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of Central Excise vs Rexin Sea India Ltd. on 29 April, 2003
Equivalent citations: 2003(156)ELT147(TRI-CHENNAI)
ORDER S.L. Peeran, Member (J)
1. The Revenue is aggrieved with the order-in-original No. 33/97, dated 1-7-97, by which the Commissioner of Central Excise, Madurai has dropped the demands raised by the Revenue in respect of 2,850.20 Mtrs. of Rexin Cloth seized from one Shri D. Rajagopal, Trader, carrying on business in the name of DRG Sales Corporation. The case was booked on the basis of statement of Shri D. Rajagopalan and entries made in 5 note-books maintained by him. The details of these entries and the note-books form Annexure 42 to Mahazar dated 11-1-85. The Commissioner, after detailed consideration, noted that Shri D. Rajagopal was not produced for cross-examination as he was no more. He also noted that no supporting documents had been recovered from the respondents to establish the illicit transaction. There was also no gate-pass/bins for supply of Rexin by the Respondents to DRG. He has also after detailed consideration found the charges pertaining to this item were on the basis of entries made in 5 note-books which is not substantiated. Hence he dropped the demands. Further, he has also confirmed other demands and penalty in respect of other clearances on which duty had not been paid. The Revenue is aggrieved with the dropping of the charges and contend that the statement of Shri D. Rajagopalan and the entries made in the private 5 notebooks are sufficient for the purpose of confirming the demands and the demands should have been confirmed and penalty should have been imposed on such clearances.
2. Appearing on behalf of the Revenue, ld. DR Shri C. Mani argued on the basis of the grounds made out in the memorandum of appeal, and submitted that the Commissioner was not justified in dropping the demands on the basis of the entries made in the note-books maintained by DRG RP.
3. Appearing on behalf of the Respondents, ld. Counsel Shri J. Sankara-raman submitted that the Respondents had filed O.S. No. 257/1989. before the Principal Sub-Judge, Madurai seeking for declaration and injunction against the department to restrain them from relying on the details in item No. 42 in the An-nexue to Mahazar dt. 21-2-85. It was their contention that there was a series of correspondences by the Respondents with DRG Sales Corporation with regard to misuse of the Respondents' brand name by RSI. The department has seized the files with all their correspondence but have not made them available the copies of the seized documents. Therefore, they have filed an original suit seeking an order of restrain and restricting the injunction against the department relying on the serial No. 42 in the Annexure to the Mahazar which pertains to the demands which has been dropped by the Commissioner. Ld. Counsel filed a copy of the judgment rendered in the O.S.No. 257/1989 by the Principal Sub-Judge, Madurai, wherein their prayer had been accepted and the department was restricted from proceeding with any adjudication on the basis of annexure which will have bearing on any of the documents comprised in item 42 of the Mahazar. The ld. Counsel submits that the Revenue has not filed any appeal against the judgment in O.S. No. 257/89 and therefore the Commissioner was justified in dropping the demands. He submits that there is no correctness to the entries made in the note-book and Shri D. Rajagopal was also produced for cross-examination. He relied on the judgment rendered in the case of Ambika Chemicals v. CCE, Chennai reported in 2002 (148) E.L.T. 101 (T) wherein this Bench has held that entries made in the note-books maintained by a chemist of a firm with regard to production of various leather chemicals is not a reliable piece of evidence to establish the charges of the clandestine removal. He submits that it is a well settled proposition of law that the demand on clandestine removal cannot be confirmed on the basis of the entries made in a private note-book.
4. We have carefully considered the submissions made and note that the Commissioner has given a detailed finding for dropping the demand on a quantity of 2,850.20 mtrs. of Rexin cloth seized from DRG RP. The statement of D. Rajagopal was recorded, who was not produced for cross-examination. The department did not supply any gate pass/bills or any supporting documents to show that the seized goods had been manufactured and cleared by Respondents. They have also not shown any link between RSI and DRG Sales Corporation. Further the demands raised on the basis of five note-books maintained by Shri D. Rajagopal is not a reliable piece of document. Further Shri D. Rajagopal was not summoned for cross examination. The respondents had filed the judgment copy in O.S.No. 257/89 passed by the Principal Sub-Judge, Madurai seeking injunction against the department from utilising the Serial No. 42 of the annexure to Mahazar dated 21-2-85. The Principal Sub-Judge accepted their pleas. The department has been restrained from utilising the evidence pertaining to Sl. No. 42 of the Mahazar which pertains to the details contained in 5 note-books seized from Shri D. Rajagopal. The Revenue has not established their case for confirming the demand. There is no infirmity in the Commissioner's order in dropping the demands in respect of the entries made in the 5 note-books maintained by Shri DRG RP, Thirupur. In that view of the matter, there is no merit in the Revenue appeal and as such the same is rejected.