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2015 (8) TMI 146 - AT - Central ExciseDisallowance of CENVAT Credit - non-receipt of material - allegation that supplier has no manufacturing facility - principle of natural justice - cross examination not allowed - extended period of limitation - levy of penalty - Held that:- It is beyond comprehension that a man will get invoices without inputs and separately acquire inputs clandestinely from other sources to manufacture his goods. There is no whisper about M/s. Dhakad Metal Corporation to be indulging in clandestine removal of finished goods in these proceedings. It is now well settled legal position that a case can not be established on the basis of few confessional statements without other corroborative evidences like shortage of raw materials, cash transactions, alternative procurement of raw materials. Appellant requested for cross-examination of the persons whose statements are relied upon but the same was not extended. It is now well settled law that cross-examination of the persons whose witness are relied upon by the Revenue should be extended to the appellant and in the absence of such cross-examination extended, the statements of such persons can not be relied upon as evidence. - appellant M/s. Dhakad Metal Corporation can not be held to have any malafide intention to take wrong credit and extended period of demand cannot be invoked in the present case against them. In this case, the demand is for the period 2005-06 whereas the show cause notice was issued on 20.02.2009. As the extended period is not invokable, therefore, the demand is also time barred in addition to credit being admissible on merits. Penalties under Rule 15 of Cenvat Credit Rules, 2004 are required to be imposed upon the persons who has taken or utilised CENVAT credit in respect of inputs or capital goods wrongly in contravention of any of the provisions of Cenvat Credit Rules. Appellant M/s. Bhavna Metal Company has not been shown to have taken any credit wrongly. Further from the case records it is observed that it is not brought out by the Revenue that at the time of issuing cenvatable invoices registered dealer did not receive inputs alongwith duty paying documents. The fact of duty being paid by M/s. Prasun Ferro Alloys & Metal Casting Pvt. Limited has not been denied by the Revenue. Though later investigations done by the department does raise a strong suspicion of not receiving the inputs but the same is not corroborated by any independent evidence, except few statements. - In the absence of cross-examination of relied upon witness given the evidentiary value of the relied upon statements is lost - Decided in favour of assessee.
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