Ramachandran Nair, J.:— Heard the Assistant Solicitor General appearing for the appellant and counsel appearing for the respondent. Pursuant to information that respondent was engaged in clandestine removal of goods without payment of duty, the department conducted search in the business premises of two units of the respondent and in the residence of the pro-prietrix. Documents pertaining to business transactions were seized. Evidence was also collected from the Bank which showed withdrawals and deposits of massive amount by the assessee. Statements were recorded from several employees giving details of production, sales etc. Based on the materials gathered, the Adjudicating Authority confirmed duty and penalty on the respondent. The first appellate authority concurred with the finding of the Adjudicating Authority. However, on further appeal, the Tribunal cancelled the demand. It is against this order the Revenue has filed this appeal.
2. We have gone through the Tribunal's order and the orders of the two lower authorities. We find that the Tribunal has considered only the grounds of appeal raised by the respondent and they have proceeded to assume that the department has not discharged their burden in proving clandestine removal of dutiable goods.
3. Strangely, the Tribunal has not considered any evidence relied on by the department like the statements recorded from the employees, admission made by the proprietrix at the time of search and the evidence collected from the Bank pertaining to business transactions. When prima facie evidence is established by the department, particularly with reference to banking transactions, it is for the respondent-assessee to explain why the transactions should not be treated as pertaining to business. The Tribunal failed to note that reasonable inferences can be drawn from evidence collected by the department, more so when the respondent fails to explain the transactions brought on record. Strangely, the employees statements which have evidentiary value have been ignored by the Tribunal. However, we do not want to enter any finding on facts based on evidence collected in the course of search and enquiry conducted by the department. Counsel for the appellant contended that the adjudication given up for Calicut unit does not bar the department from pursuing against Quilon unit because contrary to what Tribunal has said, facts relied on by the department are entirely different. Since we are thoroughly dissatisfied with the order of the Tribunal which was issued without reference to the materials gathered by the department and based on which adjudication was made, we set aside the order of the Tribunal with direction to the Tribunal to rehear the matter after calling for the search records and after considering the evidence relied on by the adjudicating officer. The Tribunal is directed to issue fresh orders within a period of four months from now. The parties will produce copy of this judgment for timely compliance of the judgment.