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TMI Blog2011 (3) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... HR Coils classifiable under sub-heading No. 7208.39 of the first schedule to the Central Excise Tariff Act, 1985 and have sales depot of M/s Essar Steels Limited, Hazira, Distt-Surat, Gujarat, which is a manufacturing unit. 4. In the case in hand, the goods which were manufactured by M/s Essar Steels Limited, Hazira and were meant to be supplied to M/s Hero Cycles Limited after being cleared from the factory of M/s Essar Steels Limited, Hazira were first unloaded in depot premises of the assessees herein at Ludhiana and from their depot they were subsequently transported to the factory of M/s Hero Cycles Limited. In the background of these undisputed facts, it is the case of the department that the assessees were required to enter the receipt of those goods in their RG-23D register and issue necessary invoices at the time of clearance of those goods from the assessees depot to be transported to the factory premises of M/s Hero Cycles Limited but they failed to make such entry as well as to issue such invoices and, therefore, the goods were liable to be confiscated and penalty was imposable in terms of Rule 209A of the erstwhile Central Excise Rules, 1944. 5. The learned Advocate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessees as a transit point and were thereafter collected by M/s Hero Cycles Limited. It was further stated that since the goods were neither transferred to the sales depot of the assessees nor they were consigned to the assessees neither the same was recorded in the RG23D register nor did the assessees availed credit in respect of the same, nor they issued any invoice under Rule 57GG of the said Rules in respect of the said goods. It was also specifically stated that 'we were acting only as a transit point agents in respect of the same and consequently no infirmity attributed towards us in acting as transit point agents, inasmuch as, we did not avail credit in respect of said goods or did we issue a invoice under erstwhile Rule 57GG in respect of the same'. In short, it was the defence of the assessees right from the beginning of the proceedings against the assessees that the goods were received in the godown merely as a transit point. Neither they were consigned to the assessees nor they were transferred to the depot of the assessees, neither the assessees took any credit in respect of the duty paid on those goods nor they issued any invoice under Rule 57GG and, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure to be followed in this regard specifically under clause 9. But, at the same time, it has been clarified by the Board in cases where the registered person does not propose to issue a modvatable invoice i.e. in other words it does not intend to pass any credit in favour of the consignee, in such cases the registered person need not enter the goods in the RG23D register nor need to issue the invoice. It is only in case where credit is proposed to be passed on to the consignee in that case in the situation described in the circular, question of making necessary RG23D register and issue of invoice would arise. 12. As already seen above, in the case in hand, the assessees never intended to issue any modvatable invoice nor to pass any credit and in fact they themselves had not availed the credit in respect of goods in question. This was not only the defence of the assessees but it is an undisputed fact as it is not the case of the department that the assessees had availed any credit in respect of duty paid on such goods or that any attempt was made to pass on credit by the assessees to M/s Hero Cycles Limited in relation to the 77 H.R. Coils. 13. The decision of the Apex Court in In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o prevent fraud and collusion in an attempt to evade tax. In the nature of things, in view of innumerable transactions that may be entered into between dealers, it will well-nigh be impossible for the taxing authorities to ascertain in each case whether a dealer has sold the specified goods to another for the purposes mentioned in the section. Therefore, presumably to achieve the two-fold object, namely, prevention of fraud and facilitating administrative efficiency, the exemption given is made subject to a condition that the person claiming the exemption shall furnish a declaration form in the manner prescribed under the section. The liberal construction suggested will facilitate the commission of fraud and introduce administrative inconveniences, both of which the provisions of the said clauses seek to avoid". (Emphasis supplied) 15. The Apex Court thereafter ruled thus:- "It can thus be seen that the submission namely that the dealer, even without filing a declaration, can later prove his case by producing other evidence, is also rejected. This ratio applies on all fours to the case before us. As already mentioned the concession can be granted only if the raw material is used ..... X X X X Extracts X X X X X X X X Extracts X X X X
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