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2016 (6) TMI 762 - AT - Central ExciseFraudulent availment of Cenvat Credit without receipt of raw material in the factory - as per department the appellants though imported goods vide Bill Entry , diverted the same without bringing the goods into the factory or use in their manufacture - Held that:- Mere statements recorded would not be sufficient to establish the charges alleged in the show cause notice. The statements should be supported by corroborative evidence. In the case on hand, if the department alleges that the raw materials were diverted without reaching the factory, then there should surely be evidence let in to show how the appellants have substituted the raw material since the statutory records show production and clearance of finished goods on payment of duty. There is absolutely no evidence to show the substitution of raw material which in my view would cut the root of the allegation as the statutory records show that goods were manufactured. No shortage of raw material was detected during enquiry. Apart from the above, the statement of the transporter Shri Satish Agarwal has been retracted before a Magistrate and Sri Janakiram in cross examination retracted his statement and also deposed that his statement was recorded under duress. The case of the department is built-up mainly on these statements. As the statements have been retracted, there has to be some other evidence to conclude that the goods were not actually received. Whereas, the statutory records, weighment slips, job work challans, production register all stand in favour of the appellants. These documentary evidence do prevail over the retracted confessional statements Though the department alleges that there was cash flow in return for the fraudulent activity, which was unaccounted, there is no evidence in this regard. When the statutory records are proper and appellant has manufactured the final products and cleared them by paying duty, then the burden rests heavily upon the Revenue to establish with cogent evidence that the goods were not actually received in the factory. In the totality of facts and evidence, paced it is find that revenue has miserably failed to establish the allegations raised in the show cause notice. Thus disallowance of credit availed is not sustainable. - Decided in favour of assessee
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