CCE Vs. RAM SHIV INDUSTRIES LTD.

JUDGEMENT

(1.) The Revenue has filed these three appeals, being aggrieved by the Order -in -Appeal No. 181 -183/03 dated 23.7.2003 passed by the Commissioner (Appeals).

(2.) Shri Virag Gupta, learned DR, submitted that respondents, M/s. Ram Shiv Industries Ltd. and Ors., manufacture iron and steel products that on the basis of specific information that they were indulging in suppression of production of goods and their removal without payment of duty, the Central Excise officers visited their factory premises on 4.12.98 and detected shortage of 37.262 MT of M.S. Round and recovered 32 numbers of duplicate set of invoices showing clearances of 378.150 MT saria without payment of duty; that the officers also searched the residential premises of Shri P.N. Mishra, authorized signatory and recovered certain incriminating documents. The scrutiny of these documents revealed that the respondents had cleared 61.060 MT of saria without payment of duty and that they had not accounted for 127.165 MT of ingots received in their factory, which was received to manufacture saria; that the Department alleged that the respondents had manufactured 120.807 MT saria out of the said quantity of ingots and removed the same without payment of duty; that on scrutiny of invoice No. 12 dated 19.4.96, of M/s. Mawana Steels Pvt. Ltd., it was found that 12.340 MT of M.S. ingots was not accounted for in the statutory records and 11.723 MT of saria, manufactured out of the said ingots, had been removed without payment of duty; that the Joint Commissioner, under Order -in -Original No. 50/2000 dated 11.12.2000, confirmed the demand of duty of Rs. 9,16,601 and imposed an equal amount to penalty under Section 11 AC of the Central Excise Act read with Rule 173Q of the Central Excise Rules, 1944 besides imposing a penalty of Rs. 2 lakh on Shri Suraj Prakash, Director, a penalty of Rs. 10,000 on Shri P.N. Mishra, and a penalty of Rs. 5,000 on Shri D.P. Shukla; that on appeal, the Commissioner (Appeals'), under the impugned order, has dropped the demand of duty, set aside the penalties imposed and allowed the appeals with consequential relief on the ground that the documents were planted by Shri D.P. Shukla, an ex -employee of the company, who did not have good relations with the company; that statements had been retracted immediately after the same were being recorded; that hand -writing experts' opinion had been rejected by the Adjudicating Authority; that the Directors had expressed doubt at the time of initial investigation itself; that recovery of invoices from an insulated servant quarter of the company may not be conclusive piece of evidence to prove clandestine removal, particularly when scribe of the said invoices was not examined and mere recovery of invoices, showing despatch of ingots to the respondents, may not be the supporting evidence.

(3.) Learned DR, further, submitted that the documents were recovered from a room situated within the factory premises in the presence of witnesses; that the examination of these invoices reveal that the date of removal, quantity, value and duty had been filled in these invoices in the same manner as was done in their invoices duly accounted for in the statutory records; that P.N. Mishra had admitted that these invoices were pre -authenticated by Suraj Prakash, Director; that this fact was also admitted by Shri Naveen Kumar, another Director in his statement; that Suraj Prakash had also admitted to have pre -authenticated those invoices; that as the Directors and P.N. Mishra had not disowned their signatures appearing on the invoices, the demand on the basis of these invoices was rightly confirmed by the Adjudicating Authority; that no more evidence was required to support the clearances of the goods removed clandestinely; that other evidences are required only when the assessee disowns the duplicate invoices. He, further, mentioned that the respondents have not supported their contention that the steel ingots, received under Invoice No. 12 from M/s. Mawana Steels, were returned to the supplier; that on the basis of the records of M/s. Mawana Steels Pvt. Ltd., clearly show that the ingots were sold to the respondents; that onus to prove that the said ingots were returned back, is on the respondents, which has not been discharged by them; that Shri P.N. Mishra had filed retraction affidavit on 13.1.2000 after a gap of two years of his, statement, which is nothing but after thought; that no affidavit was submitted by both the Directors in relation to retraction of their statements. He also contended that the report of private hand -writing expert and that too in absence of any specimen signature, said to have been examined by the document expert, cannot be rejected. He, therefore, requested that order of the Joint Commissioner may be revived by setting aside the impugned Order -in -Appeal.