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2018 (9) TMI 1571 - AT - Central ExciseFraudulent availment of cenvat credit - fraudulent availment of area based exemption Notification No. 50/2003-CE dated 10.06.2003 - Area Based Exemption - it was alleged that goods manufactured by M/s AO has been shown on paper but the same has been manufactured and cleared by M/s AI without payment of duty - undervaluation - related parties. Area based exemption - it is alleged that the appellant have mis-used the benefit of exemption Notification No.50/2003-CE dated 10.06.2003 and availed benefit of the said Notification without manufacturing the goods - Held that:- It has been alleged against by the appellant is that the appellant had cleared fully finished chrome plated spanners under the guise of forgings to their sister unit. The appellant has explained CP stands for ‘Cold Pressed’ whereas it has been presumed by the adjudicating authority as ‘Chrome Plate’ and explanation given by the appellant by way of affidavits has not been considered. In that circumstance, it cannot be presumed that CP is used for “Chorme Plates”, therefore, on that ground it cannot be held that the appellant M/s AO was cleared “Chrome Plate” spanners under the guise of forgings to M/s AI - M/s AI is having facility of electroplating and installed the machinery in their factory. The same has been found installed by the authorities below. In that circumstances also, the benefit of doubt goes in favour of the appellants, therefore, the goods cleared from the premises of M/s AI are entitled under exemption of Notification No. 50/2003-CE dated 10.06.2003 - the demand cannot be raised on account of denial of benefit of exemption Notification No. 50/2003-CE dated10.06.2003, therefore, the demand of ₹ 57,81,475/- is set aside. CENVAT Credit - it is alleged that appellant M/s AO has not received the inputs and availed cenvat credit without receipt of the goods - Held that:- The allegations against the appellant M/s AO is that they have not received the goods are based on the various statements, no cross objection of the persons whose statements have been relied and granted and no other corroborative evidence has been produced on record by the Revenue in support of the allegation - it cannot be held that the appellants had not received any goods in the absence of any corroborative evidence and merely relying statements of the suppliers - further, no statements of the transporters has been recorded to substantiate the statements of the suppliers - credit cannot be denied. Valuation - it has been alleged that clearance made by M/s AO to M/s AI have been undervalued - Held that:- The fact on record that M/s AO is clearing the goods on the same price to M/s AI as well as to independent buyers, therefore, Rule 9 of the Valuation Rules, is not applicable to the facts of the case - the charge of undervalued is not sustainable against the appellants. Appeal allowed - decided in favor of appellant.
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