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2019 (12) TMI 523 - CESTAT CHENNAICENVAT Credit - duty paying invoices - fake invoices - it was alleged that M/s. Star Delta Exim P. Ltd. was issuing invoices without supply of goods - denial of cross-examination - HELD THAT:- The foremost argument put forward by the ld. counsel is that though the investigation is initiated from M/s. Star Delta Exim P. Ltd., the supplier of the goods, he has not been made a party to the present proceedings. The evidence gathered by the department in the investigation done at the end of M/s. Star Delta Exim P. Ltd. has been used to issue a Show Cause Notice to the appellant herein. The appellant cannot have any knowledge of the accounts or the activity of the supplier and would not be in a position to challenge the allegations if the said supplier is not a party to the proceedings initiated against the appellant. The department does not have a case that during the said dates the appellant did not manufacture finished goods. In the statement of Shri Pawan Kumar, director of M/s. Star Delta Exim P. Ltd. relied by the department, it is clearly stated that he was issuing fictitious invoices on commission basis to Chandra Proteco Ltd. - The Show Cause Notice has even then been issued merely relying upon the statement of the proprietor of Happy Transport. When the department has relied strongly on the statement of the proprietor of Happy Transport as well as that of Pawan Kumar, Director of M/s. Star Delta Exim P. Ltd., they ought to have given an opportunity for cross-examination of these witnesses. There are no plausible explanation put forward by the adjudicating authority for denying the cross-examination. The Hon'ble High Court of Punjab & Haryana in the case of G-Tech Industries Vs. Union of India [2016 (6) TMI 957 - PUNJAB & HARYANA HIGH COURT] has emphasized the need for cross-examination of the witnesses when the statements are relied by the department. The credit availed by the appellant is in order. There is no evidence put forward by the department to establish that appellant has availed credit on fictitious invoice. The department has failed to prove the allegations alleged in the Show Cause Notice - Appeal allowed - decided in favor of appellant.
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