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2013 (1) TMI 123 - AT - Central ExciseRule 11 of the Central Excise Rules, 2002 – Eligibility to CENVAT credit on the basis of invoices issued by dealers - Rule 7 of CENVAT Credit Rules, 2002 – Ineligible CENVAT credit – Credit on the basis of forged invoice – Bogus purchase Duty paying document - Whether the appellants have correctly availed CENVAT credit of duty on the basis of invoices issued by the dealers - demand on the ground that the appellants have availed credit on the invoices issued by Simandhar which do not find mention in the RG-23D register maintained by Simandhar – alleged that when the duty paid goods supplied by the ship breakers did not cross the Gujarat Border, the dealers at Bhiwandi/Mumbai could not have received the said duty paid goods physically and consequently they could not have delivered the same to the appellants There is a difference of opinion arose between the Members, therefore the matter is placed before the Hon'ble Vice President/HOD for appointing a 3rd Member to decide the issue - Whether the appellants have correctly availed CENVAT credit of duty on the basis of invoices issued by the dealers in the facts and circumstances of the case as held by the Member - Whether the demands are barred by limitation in the facts and circumstances or not. Decision of 3rd member Vehicles were found to be non-transport vehicles as per RTO's report - Incapable of transporting huge quantities of iron and steel scrap, which was the input on which CENVAT credit of excise duty was taken - Appellants contended that the delivery in these cases were arranged by the dealers themselves and the freight was pre-paid - Discrepancy occurred due to entering of incorrect numbers of the transport vehicles by the dealer as admitted by the dealer – Held that:- Following the decision in case of RANJEEV ALLOYS LIMITED (2008 (9) TMI 223 - CESTAT NEW DELHI) that CENVAT credit involved in 306 invoices where the vehicles were found to be non-transport vehicles as per the RTO's reports and where the appellants have not been able to produce any reliable evidence with respect to the receipt of the goods in the factory, the appellant are not entitled for the CENVAT credit. In favour of revenue CENVAT credit on the basis of invoices issued by dealers based on ship breakers' invoices - Ship breakers supplied were steel plates and re-rollable scrap which are not generally used for re-melting and are generally used by rolling mills – Some of ship breaking scrap closed down their activities since a long time, invoice are not genuine - Vehicles used for transportation were motorcycles, tankers, cars, autorickshaws, delivery vans, etc. incapable of transporting iron and steel scrap - Statements of a few of the transporters who have denied transporting any goods from Gujarat to Mumbai - Statements from some of the ship breakers they supplied steel plates of various dimensions or re-rollable scrap not steel melting scrap Held that:- The department need not prove the case with mathematical accuracy. So long as the department has established the case with such degree of preponderance the existence of a fact, it is sufficient. In the instant case, the burden to establish eligibility to the credit is on the appellant- assessee and if they fail to establish or explain the facts established by the department, and adverse inference arises against them coupled with the presumptive evidence adduced by the department. Once the Revenue discharges the burden that the particulars declared in the documents on the strength of which the credit has been availed are not genuine or are fake, then the onus is on the assessee to prove that they have availed the credit correctly and is entitled for the credit. That onus cannot be condoned on the ground of hardship or inconvenience. In the instant case, the appellants have not discharged this onus cast on them by the statute. In favour of revenue Whether the appellants are eligible to avail CENVAT credit on account of duplicate/parallel invoices – The RG23-D account maintained by the dealers, the invoices issued to the appellants are not reflected - Invoices bearing the same number are shown to have been issued to other buyers though for a different quantity and value - the transporters who are said to have transported these goods from the dealers' premises to the appellants have denied transporting these goods – Held that:- Following the decision in case of Mahalaxmi Cotton Ginning Pressing and Oil Industries (2012 (5) TMI 152 - BOMBAY HIGH COURT) that the appellants herein have not made any case for their eligibility to CENVAT credit on the parallel/duplicate invoices received from the dealers. In favour of revenue Extended period of limitation – Fraud – Collusion - Conspiracy to deprive the exchequer – Ineligible CENVAT Credit - Held that:- In such a situation, extended period of time is rightly invokable and, therefore, hold that the demand for CENVAT credit wrongly taken invoking the extended period of time is sustainable in law. In favour of revenue Therefore, the appellants are not eligible to avail CENVAT credit and that the extended period of time has been rightly invoked in demanding the same.
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