TMI Blog2014 (9) TMI 331X X X X Extracts X X X X X X X X Extracts X X X X ..... of any allegation that the appellants were parties to the fraud, the larger period of limitation cannot be applied, and thus, even if the original document was assumed to be issued by practising fraud, the appellants being holders in due course for valuable consideration without notice, the larger period of limitation cannot be extended in the case before us. In this connection, we may profitably refer to the decision of the Supreme Court in the case of Commissioner of Central Excise, Belapur v. E. Merck India Ltd. [2007 (7) TMI 299 - SUPREME COURT] where the Supreme Court took a view that in the absence of a willful misdeclaration on the part of the respondent-assessee, there was no scope of invoking Section 11A of the Act. The documents, invoices in question, issued by the registered licencee being genuine and in the absence of any allegations against the appellants of fraud, the Tribunal should not have remanded the matter back as the claim was totally barred by limitation. - Decided in favor of assessee. - Tax Appeal No. 406 of 2012 with Civil Application No. 166 of 2012 - - - Dated:- 19-12-2012 - Akil Kureshi and Sonia Gokani, JJ. Shri Paresh M. Dave, Advocate, for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. The Commissioner of Central Excise (Appeals), Surat also rejected the appeal of the appellant herein except the penalty on Director of the appellant, which was dropped by the Commissioner (Appeals) under Rule 13(1) of the Cenvat Credit Rules. 4. The appeal was preferred before the Central Excise Service Tax Appellate Tribunal. It was disputed that the alert circulars issued by the Commissioner of Central Excise, Surat could not have been issued as the Commissioner had no jurisdiction to issue such circular. Some of the weavers shown as non-existant, in fact, operated their weaving units. The Tribunal decided the appeal by a common order dated 24-1-2011, and remanded the case to the original appellate authority. The appellant s appeal also met the same fate on 28-3-2011 and the same was remanded to the original adjudicating authority. 5. Aggrieved by the said order, present appeal is preferred proposing the above mentioned questions of law. 6. Heard both the sides and also took note of the decision of the Court rendered in the case of Tax Appeal No. 1153 of 2011 [2013 (290) E.L.T. 61 (Guj.)] and group of appeals. 7. This being the decision of the coordinate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he department can escape its liability to find out a person who was registered with them and to pursue him for payment of duty. There is also no dispute in these cases that the goods were purchased by the merchant manufacturer officially and they have suffered the duty thereon and the amounts have been paid through cheques. 9. It is also not a case where the invoices are manufactured documents not signed by the original manufacturer. The invoices which are accounted for in the Return of the person, were the invoices accounted for in the Return of the persons registered with the Central Excise. Thus, merely because the manufacturer cannot be found at the present, such fact cannot make the invoices fake or fraudulent documents in the eye of law. These are actual invoices issued by the manufacturer who is duly registered under the Central Excise Act and, therefore, those cannot be said to be forged documents. In our opinion, merely because today, the original manufacturer, who is registered with the Revenue, is not traceable, it does not mean that he did not exist at the relevant point of time. If today, a manufacturer is not available for various reasons that does not mean that at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnot be supported as Afloat case is one pertaining to a forged document but not in respect to a document otherwise genuine, issued by practising fraud. The facts stated in the case of Afloat indicated that the same was a case of a forged invoice and thus, the principles laid down therein cannot have any application to an invoice which is, otherwise, genuinely issued by a manufacturer registered with the Revenue. Justice Arijit Pasayat who delivered the judgment of the Supreme Court in the case of Afloat (supra), in a subsequent case of Commissioner of Customs v. Ajay Kumar Company, reported in 2009 (238) E.L.T. 387, clearly indicated that the same being not a case of forged document but one of issue of licence by practising fraud, the Tribunal was right in holding that the transferee of the licence should not be made liable. It may not be out of place to mention here that the Tribunal, in its judgment, reported in 2006 (205) E.L.T. 747 indicated in paragraph-7 as follows : if that be so, the concept that a fraud vitiates everything would not be applicable to cases where a transaction of transfer of licence is for value consideration without notice, arising out of mercantile t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court : (i) CCE v. Chemphar Drugs Liniments, reported in 1989 (40) E.L.T. 276. (ii) Padmini Products v. Collector of Central Excise, reported in 1939 (43) E.L.T. 195. (iii) Lubrichem Industries Limited v. CCE, Bombay, reported in 1994 (73) E.L.T. 257. (iv) Nesle (India) Limited v. CCE, Chandigarh, reported in 2009 (235) E.L.T. 577. xxx xxx xxx xxx xxx xxx xxx xxx xxx 14.8 Lastly, in the case of Commissioner of Central Excise, Jalandhar v. Vardhaman India Products reported in 2009 (236) E.L.T. 637 (P H) where the Punjab Haryana High Court was dealing with a case where extended period of limitation was claimed on the allegation of fraud levelled against the assessee besides violation of provisions of the Act and the Rules. It was held that the party fraudulently availed of Modvat credit and the party s conduct and admission of guilt was evident from the facts of the case. 14.8.1 In the facts of the case, the principles laid down, in the aforesaid decision cannot have any application to the facts of the present case where there is no allegation of fraud against the appellant and only because the original, manufacturer who was registered w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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