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M/s Aditya Laminators Pvt Ltd, Shri Vivek C Vaidya, Shri Yogesh N Desai Versus Commissioners of Central Excise, Customs and Service Tax-Daman

2015 (5) TMI 23 - CESTAT AHMEDABAD

Undervaluation of goods - Demand of differential duty - Held that:- Appellant had no knowledge that the input suppliers were not registered with the Central Excise Authorities. The appellant during the investigation, categorically stated that they received the goods accompanied with Central Excise invoice and duty recorded in Cenvat Register. It is further evident from record that inputs were utilized in the finished goods, cleared on payment of duty. There is no material available that the appe .....

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ent of ₹ 1,41,142/- from Milan plastics for the goods cleared under the said invoices. The appellant in reply to show cause notice took a stand before the Adjudicating Authority that the said paper would not reveal the clearance of goods in respect of the said invoices. It is stated that the figures mentioned in the rough paper pertained to cash received by the appellant factory from their office for disbursement to the employees. There is no indication undervalue of sales of scraps. The a .....

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cided in favour of assessee. - Appeal No. E/799,800,801/2008, Application- E/ORS/19139-41/2015, E/MA(EXTN)/15252,15251,15250/2014 - Order No. A/10335-10337 / 2015 - Dated:- 17-4-2015 - Mr. P.K. Das, Hon'ble Member (Judicial),J. For the Appellant : Shri Rahul Gajeria, Advocate. For the Respondent : Shri J Nagori , Authorised Representative ORDER Per : Mr.P.K. Das, The relevant facts of the case, in brief, are that the Appellant No.1 was engaged in the manufacture of Plastic Bags and Pouches f .....

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.2004 was issued proposing to deny the cenvat credit of ₹ 44,10,384.00 wrongly taken alongwith interest and to impose penalty during the period from 3.1.2000 to 25.10.2003. It has also proposed demand of differential duty of ₹ 14,266/-alongwith interest and penalty on clearance of 4953.400 kgs of plastic scrap/waste as undervalued. It has proposed imposition of penalty on Shri Vivek C Vaidya, Managing Director of the appellant company and Shri Yogesh N Desai, Manager/Authorized Signa .....

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Rule 2001 and 2002 and Rule 14 of the Cenvat Credit Rules, 2004 read with provisions of proviso to sub-section (1) of Section 11A of the Central Excise Act 1944. It has also confirmed the demand of Central Excise duty of ₹ 14,266/- alongwith interest. It has also imposed penalty of equal amount of duty on Appellant No.1 company. Penalty of ₹ 5,00,000/- and ₹ 1,00,000/- were imposed on Shri Vivek C Vaidya, Managing Director and Shri Yogesh N Desai, Manager/Authorized Signatory r .....

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ubmits that the appellant availed cenvat credit on the basis of the invoices issued by the registered manufacturer/dealer and duly recorded in the cenvat account. It is evident from the record that the inputs were used in the manufacture of final product and cleared on payment of duty. It is contended that at the initial stage, the Superintendent of Central Excise verified and allowed Modvat credit and duly endorsed in the invoices. The Learned Advocate drew the attention of the Bench to the rel .....

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Firm Shri Pradeep vs. Union of India 2014.TIOL.1251.HC.AHM.CX. He also relied upon the decision of the Tribunal in the case of Akik Dyechem Pvt Ltd vs. Commissioner of Central Excise, Ahmedabad 2013(290)ELT.273 (Tri.Ahmd). 4. He submits that the credit cannot be denied on the basis of simple report of the Central Excise Officers, as the jurisdictional Superintendent already verified the invoices. He relied upon the decision of the Tribunal in the case of Suraj Lamps and Industries Pvt Ltd vs. Co .....

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rates the findings of the Commissioner (Appeals). He submits that admittedly the appellant availed the credit on the basis of the invoices issued by the non-existence firms. It is submitted that the appellant did not dispute this fact and therefore the demand of duty and imposition of penalty are justified. Further, he submits that the Hon ble High Court of Punjab and Haryana in the case of M S Metals vs. Commissioner of Central Excise, Haryana 2014(309) ELT.241 (P&H) rejected the appeal of .....

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envat Credit Rule 2004. He relied upon the decision of the Hon ble High Court of Gujarat in the case of Sheela Dyeing and Printing Mills Pvt Ltd vs. CCE and C., Surat 1 2008(232)ELT.408(Guj). Learned Authorised Representative filed written submission opposing application for additional ground filed by the appellant. 6. After hearing both the sides and on perusal of records, I find that during the period from 3.1.2000 to 25.10.2003, the appellant availed cenvat credit on the basis of invoices iss .....

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ntral Excise Officer of the Head Quarters visited the appellants factory and withdraw input invoices from the factory for further verification. Jt. Commissioner (Prev.), Central Excise, Mumbai II Commissionerate vide letter dtd 25.6.2004 reported that input supplier M/s Raj Petrochem Ltd, was neither any dealer nor any manufacturer registered under Central Excise, Mumbai II Commissionerate and the same was found to be non-existence. Similarly, the invoice issued by the M/s J V Petrochem Ltd has .....

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tial stage as required under the law. 7. Shri Vivek C Vaidya, Managing Director of the appellant Company (Appellant No 2 herein) in his statement dated 27.9.2004 stated that they received the goods with the central excise invoices through the broker from the said input supplier. The central excise invoices were verified and defaced by the Superintendent of Central Excise at the initial stage. Thus, there is no scope to doubt the genuinty of invoices. It is evident that the duty paying documents .....

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intendent of Central Excise at the initial stage. There is no material available on record that the appellants had any knowledge of the issue of the invoices by the non-existence firms. It is evident from the record that the invoices contained all the information, such as, central excise duty, PLA entry number, central excise Range number etc. So, there is a force in the submission of the Ld. Advocate that the demand of duty is barred by limitation. 8. Hon ble High Court of Gujarat in the case o .....

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with by taking aid of a larger period of limitation as indicated in Section 11A(1) of the Act. It is now settled law that Section 11A(1) is applicable when there is positive evasion of duty and mere failure to pay duty does not render larger period applicable. In the case before us, it is not the case of the Revenue that the transferees were party to any fraud and therefore, the Revenue cannot rely upon a larger period of limitation. Our aforesaid view finds support from the following decisions .....

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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. reported in 2009 (238 .....

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ed in Cenvat Register. It is further evident from record that inputs were utilized in the finished goods, cleared on payment of duty. There is no material available that the appellant was party to the fraud and the decision of the Hon ble High Court is applicable in this case. 10. The case laws relied upon by the Learned Authorized Representative for the Revenue are not applicable in the present case. The case of M/s M S Steel (supra) as relied upon by the Learned Authorized Representative is in .....

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