Supreme Court: Asking a Woman to Adjust in Marriage Does Not Amount to Cruelty By In-Laws  ||  Supreme Court Reiterates That Police Must Obtain Magistrate’s Permission For Further Investigation  ||  Supreme Court Upholds GST on Online Gaming, Ruling it Falls under Betting and Gambling  ||  Supreme Court: ECI Can Examine Citizenship For Electoral Rolls, But its Ruling is Not Final  ||  Supreme Court: Centre Must Consider State’s Views Before Rejecting All India Services Officer's VRS  ||  Madras High Court Bans Cow and Calf Slaughter For Bakrid, Saying it is Not an Essential Sacrifice  ||  Gauhati High Court: Confessions under Section 164 CrPC are Inadmissible if Police are Present  ||  Delhi HC: On-Duty Driver is Entitled to Compensation Unless Murder Was Personal and Targeted  ||  SC: High Courts Exercising Probate Jurisdiction Can Order Probes Into Estate Irregularities  ||  SC: High Courts Exercising Probate Jurisdiction Can Order Probes Into Estate Irregularities    

Alok Ispat Pvt Ltd vs. Principal Commissioner, Central Tax - (Customs, Excise and Service Tax Appellate Tribunal) (06 Jan 2022)

Only on the basis of statement of third party, no demand could be made

MANU/CE/0008/2022

Excise

The Appellant is engaged in the manufacture of M.S. Ingots, which are dutiable and is registered with the Department. The Appellant has been making regular compliances. The issue involved in present appeal is whether the Respondent commissioner is justified in confirming demand of Rs.6,54,599 (including cess) on the alleged clandestine removal and clearance of 218.220 M.T. of M.S. Ingots, on the basis of third party records, being entry in the diary of Monu Steels (Proprietor, S.K. Pansari), is a broker/ commission agent, who facilitates sales and purchase of Iron and Steel Materials, and also in the records of Gopal Traders (Proprietor, Shri Gopal Krishna Agarwal) is another broker/commission agent, who facilitates purchase and sales of Iron and steel products. Further, equal amount of penalty was imposed under Section 11 AC along with interest. Further, penalty under Rule 26 of the erstwhile Central Excise Rules was also imposed on Monu Steels and Naren Kumar Mishra, Director of the Appellant company and also on Gopal Traders.

In the impugned order, nowhere it has been discussed as to how the demand of duty is sustainable in the absence of any clinching evidence of clandestine manufacture and removal of the goods. The entire demand is based upon the records recovered from S.K. Pansari, Proprietor of Monu Steel. There is no evidence expect the said statement and private diary entry of 3rd party i.e. of Sh. S.K. Pansari, which contains the name of the appellant.

The law as to whether the third party records can be adopted as an evidence for arriving at the findings of clandestine removal, in the absence of any corroborative evidence is well settled. Only on the basis of statement of third party, no demand could be made. The Hon'ble High Court of Judicature at Allahabad in the matter of Continental Cement Company Vs. Union of India and also this Tribunal in the cases of Raipur Forging Pvt. Ltd. Vs. CCE, Raipur, CCE & ST, Raipur Vs. P.D. Industries Pvt. Ltd. and CCE & ST, Ludhiana Vs. Anand Founders & Engineers have categorically held that the findings of clandestine removal cannot be upheld based upon the third party documents unless there is clinching evidence of clandestine manufacture and removal of the goods. The impugned order is set aside. As a result, the penalty imposed on Director of the Appellant is also set aside. Appeal allowed.

Tags : DEMAND   PENALTY   LEGALITY  

Share :        

Disclaimer | Copyright 2026 - All Rights Reserved