2018 (10) TMI 314 – CESTAT NEW DELHI – 2018 (362) E.L.T. 885 (Tri. – Del.) – Clandestine removal – demand based on the basis of unexplained loose sheets – whether in the facts and circumstances of the case, charge of clandestine removal is sustainable against the appellants or not?
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Held that:- In this case during the course of investigation, in the factory premises of the appellant, nothing incriminating was found. Moreover, the stocks of raw material as well as finished goods has also found tallied with the statutory records. There are certain loose sheets recovered from the residence of the Director of the appellant company and on the basis of this, the case has been made out against the appellant.
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On going through the said loose sheet, it is found that some name i.e. M. Vijayvada is written thereon but to ascertain the truthness of said clearance, no effort has been made by the Revenue to investigate or to find out who is M. Vijayvada. If that effort could have been do
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d equivalent amount of penalty and penalty of ₹ 50,000/- has been imposed on the co-appellant Shri Ashok Agarwal, Director of the company. 2. The facts of the case are that on being received intelligence that the appellants are availing SSI exemption but their turnover has crossed more than ₹ 2 crores in the financial year 2013-2014, therefore, a search was conducted at the factory premises of the appellant on 29/09/2014, nothing incriminating was found during the course of search in the factory premises and all the stocks of inputs/finished goods were found in order, but during the course of search at the residence of the Director of the appellant company, certain loose sheets were found. Out of these loose sheets, some loose sheets remained unexplained by the Director of the appellant company. Therefore, on the basis of unexplained loose sheets, it was proposed that appellant is engaged in the activity of clandestine removal of goods without issuance of the invoice and no
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nd is not sustainable. He also submits that the son of the Director has filed an affidavit explaining these loose sheets, in question, and owned the same and his own responsibility and these loose sheets written by him, but no credence was given to the affidavit, in that circumstances, the demand is not sustainable. To support his contention, the learned Counsel relied on the decisions of Modern Laboratories vs. CCE, Indore – 2017 (358) E.L.T. 1179 (Tri. – Del.) and Davinder Sandhu Impex Ltd. vs. CCE, Ludhiana – 2016 (337) E.L.T. 99 (Tri. – Del.). 4. On the other hand, learned AR opposed the contention of the learned Counsel and submits that in this case the Director himself has admitted during the course of investigation that the loose sheets recovered from the possession of the Director at the residence belongs to the clandestine removal of goods and was ready to pay duty thereon, therefore, without retraction of the said statement, the same is admissible as held by this Tribunal in
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On going through the said loose sheet, I find that some name i.e. M. Vijayvada is written thereon but to ascertain the truthness of said clearance, no effort has been made by the Revenue to investigate or to find out who is M. Vijayvada. If that effort could have been done, then truth could have been revealed. Simply, on the basis of these loose sheets and without any corroborative evidence, i.e. from where the raw material has been procured, how the goods were transported and how much electricity was consumed it cannot be alleged that the appellant is engaged in the activity of clandestine removal of goods. Merely, the corroborative statement of the Director of the appellant company cannot be the basis in the clandestine removal of the goods in the light of the decision of this Tribunal in the case of Davinder Sandhu Impex Ltd. (supra), wherein it has been held that the incriminating statement relied upon by the Revenue is not admissible evidence in the absence of corroborative evide
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