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2017 (5) TMI 331 - CESTAT MUMBAICENVAT credit - duty paying invoice - the investigation revealed that M/s.Wind Industries admitted that they have issued manufacturer's invoice without manufacture of the goods and showing payment of duty, whereas they neither manufactured the goods nor paid the duty - Held that: - The investigation has clearly revealed that the invoice which originated from Wind Industries is without manufacturing of the goods and without payment of duty. The very same invoice was the basis for issuance of the first stage dealer invoice by J.K. Metal Feeders. Therefore, under this investigation, it is established that the invoice which was received by RMIL, the duty shown therein was not paid. Therefore, under any circumstances, the duty which was not paid, credit of same cannot be allowed - credit not allowed. Penalties u/s 11AC and Rule 25 - Held that: - since RMIL was not aware about the wrong doing by collusion between Wind Industries and J.K. Metal Feeders. They had a bonafide belief that the invoice is valid and the duty shown in the invoice stood paid. Therefore, there is no malafide on the part of RMIL - penalties set aside. As regards the penalty imposed on J.K. Metal Feeders, it is very clear that there was a fraud committed by J.K. Metal Feeders, colluded with Wind Industries. Therefore, the penalties imposed on J.K. Metal Feeders is sustained. Appeal allowed - decided partly in favor of assessee.
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