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2011 (6) TMI 390 - HC - Central ExciseRebate claim - contention of the Central Excise Department that the First Respondent was a party to the fraud involving the grant of rebate - Held that:- Revisional Authority proceeded on the basis that there was no allegation of a want of bonafides on the part of the First Respondent. This assumption of the Revisional Authority is erroneous because the record before the Court, indicates to the contrary. The fact that this was under investigation right from 2005 is evident from the alert circular dated 22 September 2005 noting that during the course of the physical verification of firms, as a part of an investigation into the grant of fraudulent rebate, 71 firms at Surat were found to be bogus and nonexistent. In this view of the matter, the basis upon which the Joint Secretary to the Government of India allowed the claim for rebate was wholly erroneous. The Revisional Authority would have due regard to the parameters of the jurisdiction under Section 35EE of the Central Excise Act, 1944. According to the Revenue, in these cases no excise duty was as a matter of fact paid. Cenvat credit was accumulated on the basis of fraudulent documents of bogus firms and such credit was utilised to pay duty. Since there was no accumulation of Cenvat credit validly in law, there was no question of duty being paid therefrom. This submission warrants serious consideration and the Revisional Authority would have to apply its mind to it - order of remand would be warranted in order to enable the Revisional Authority to consider afresh the Revision filed by the First Respondent against the order of the Commissioner (Appeals) confirming the rejection of the Application for rebate. There shall be an order in these terms. In the circumstances of the case, there shall be no order as to costs.
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