2026-VIL-681-CESTAT-DEL-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise – Recovery of duty on raw material cleared ‘as such’, Denial of credit for the excess consumption of raw materials - Statements under Section 14 of Central Excise Act, 1944 - Whether statements recorded under Section 14 can be considered as relevant evidence if the procedure under Section 9D of the Act is not followed – HELD - The statements made under Section 14 cannot be considered as relevant evidence as the procedure contemplated under Section 9D of the Central Excise Act, 1944 was not followed. Section 9D(1)(b) mandates that for the statements recorded under Section 14 to be relevant, the person who made the statement has to be examined as a witness before the adjudicating authority and the authority has to form an opinion that the statement should be admitted in evidence in the interests of justice. This procedure to be mandatory, as statements recorded during investigation have a possibility of being made under coercion or compulsion, and it is to neutralize this possibility that the detailed procedure has been prescribed. Since the Department did not follow the mandatory procedure under Section 9D, the statements recorded under Section 14 cannot be relied upon, and the demand confirmed based on these statements deserves to be set aside - The impugned order is set aside on this ground alone and appeal is allowed - Extended period of limitation under Section 11A(4) of Central Excise Act, 1944 - Invocation - Whether the extended period of limitation could have been invoked in the facts and circumstances of the case – HELD - The allegations against the appellant were based on the figures obtained from the balance sheet, which is a public document. When the details are already reflected in the balance sheet and periodic returns filed by the appellant, there cannot be any suppression of facts to invoke the extended period of limitation. When the details are reflected in the public documents maintained by the assessee, the extended period of limitation cannot be invoked. Further, the officers could have sought clarifications or raised objections on the information provided by the appellant in the returns, but they did not do so. In these circumstances, the extended period of limitation could not have been invoked.
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