Tribunal Reverses Commr Appeals Order Allowing Retraction of Statement In a Case of Clandestine behaviour 4 Years later at Appellate Stage

Commissioner of Central Excise & S.T., Ahmedabad Vs M/s. Shakambari Steels & M/s. Paras Steel Industries

(click to download/read decision)


  • This is a case of clandestine removal where an order was passed by the adjudicating authority confirming the demand.
  • There were statements recorded of the Proprietor of one company and the Partner of another company  confirming factual details about the clandestine activities as per registers recovered from their premises.
  • The statements were given by both voluntarily without any coercion and provided details only they would have known.
  • They have not argued before the lower authorities that their statements were not voluntary but were recorded under coercion or duress.
  • Neither of them retracted their statements during the investigation or even before or during the adjudication. 
  • Also the clandestine activities were corroborated by the transporters.
  • So what does the adjudicating officer do? He confirms the demand.

  • Then the matter goes in appeal against the order before the Commissioner (Appeals) C Ex & Customs, Ahmedabad, and THE STATEMENTS ARE RETRACTED AFTER FOUR YEARS by both of them. That too through affidavit filed before Commissioner (Appeals).

  • What does the Commissioner Appeals do? The Commissioner Appeals accepts the contention and passes an order favourable to the parties saying the "documentary evidences are inadequate against the Respondent".

  • The Revenue takes it up in appeal before the Tribunal. Tribunal correctly holds that the Department cannot be expected to foresee and investigate and ensure all possible alternate evidences. The respondents did not retract their statement during investigation or even at the time of  adjudication. They have done it only before the Commissioner (Appeals) C. Excise & Customs, Ahmedabad, who passed an order on 1st November, 2007