M/S. Balajee Loha Pvt. Ltd vs Cce, Raipur

[Arising out of Order-in-Appeal No.29/RPR-I/2014 dated 29.01.2014 passed by the Commissioner, Central Excise & Customs, Raipur]

For approval and signature:

HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL) 1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

M/s. Balajee Loha Pvt. Ltd. Appellant

Vs.

CCE, Raipur  Respondent

Present for the Appellant : Shri Manish Saharan, Advocate Present for the Respondent: Shri G.R. Singh, D.R.

Coram: HONBLE MR. S.K. MOHANTY, MEMBER (JUDICIAL)

Date of Hearing/Decision: 06.07.2015

FINAL ORDER NO. __54276-54277/2015__

PER: S.K. MOHANTY

These appeals are directed against the impugned order dated 29th January, 2014 passed by the Commissioner (Appeals), Raipur, upholding the adjudged demand confirmed in the impugned order.

2. Brief facts of the case are that appellant M/s. Balajee Loha Pvt Ltd. is engaged in the manufacture of M.S. Angle, M.S. Channel and other Rolled products, falling under Chapter 72 of the Central Excise Tariff Act, 1985. Based on the Intelligence reports, the Central Excise Officers visited the premises of M/s. Shree Bajrang Transport Service and recovered certain incriminating documents and also recorded the statements of the authorized signatories. In the statement, the transporter has stated that the finished goods manufactured by various manufacturers (including the appellant) have been transported by it to various consignees. Based on the incriminating documents recovered from the transporters premises and upon recording of statements, the department initiated proceedings against the appellants herein for confirmation of the duty demand and for imposition of penalty.

3. Shri Manish Saharan, ld. Advocate appearing for the appellant submits that no verification have been conducted at the consignees end for ascertaining the fact regarding actual receipt of the goods by them. Further, he submits that third party statement, without allowing for cross examination, cannot be relied on for substantiating the allegation of clandestine removal of the goods. He further submits that the records maintained by the appellant prove the fact the goods have not been clandestinely removed from the factory. The ld. Advocate has relied on the judgment of Honble Gujarat High Court in the case of Commissioner of Central Excise vs. Saakeen Alloys Pvt. Ltd. reported in 2014 (308) ELT 655 (Guj.) to support the case of the appellant.

4. Per contra, the ld. D.R. for the Revenue Shri G.R. Singh reiterated the findings recorded in the impugned order.

5. I have heard the ld. Counsel for both the sides.

6. I find that the statement recorded from transporter M/s. Shree Bajrang Transport Service and the incriminating documents recovered from its office premises had been solely relied on by the Department for confirmation of the duty demand and imposition of penalty on the appellant. Even though, the transporter had submitted the details of the consignees to whom the goods have been consigned by the appellants, but no verification has been conducted by the Department to ascertain the fact whether the goods have actually been consigned to the consignees indicated by the transporter. Further, the statement recorded from the appellant, nowhere accepts that the goods have been clandestinely removed from the factory without payment of Central Excise Duty. Thus, the onus lies on the Department to prove clandestine removal of the goods has not been satisfactorily discharged in this case. Reliance placed on the third party statement, without allowing for cross-examination, does not stand for judicial scrutiny for confirmation of the demand. I find that the Honble Gujarat High Court in the case of Saakeen Alloys Pvt. Ltd. (supra), have held that confessional statements solely in absence of any cogent evidences cannot be made the foundation for levy of excise duty on the ground of evasion. In view of above, I am of the considered opinion that the burden of clandestine removal has not been satisfactorily discharged by the Department and, accordingly, the impugned order is liable to be set aside.

7. Therefore, the impugned orders are set aside and the appeals are allowed in favour of the appellants.

(Dictated and pronounced in the open Court)

(S.K. MOHANTY) MEMBER (JUDICIAL) Anita 0 4