TMI Blog2015 (9) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... rucks were also, destroyed in fire. One could understand that bills/vouchers, getting destroyed in fire or lost. But one cannot understand as to what has happened to the ledgers and registers to which the transactions done in cash are ultimately transferred. It is not the appellant s case that even such ledger and registers were destroyed in the fire. The fact that the inputs in the form of ship-breaking scrap was entered in RG 23A, Part-I does not establish that the goods were received in the factory. At least two truck owners have categorically denied having transported any goods to the appellant. The fact that out of the list of vehicles which were shown to be tankers, according to RTOs Office, two vehicles turned out to be regular carriers of goods does not establish that the case of other vehicles also it was true. An exception cannot make a rule. Once it is established that the input has not been transported in the vehicle mentioned in the invoice it is but reasonable to say that the inputs were not received in the factory as required under Rule 57G . - The entire transaction was vitiated by fraud coupled with misstatement and suppression of facts with intent to evade paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Central Excise authorities on 26.08.1995 searched the premises of the appellants and resumed a number of documents not only from the factory premises but also the business premises connected with the appellants. On verification of the stock of input and output, the Central Excise authorities made out a case that there was a shortage of 2620.800 MT of slabs. On further verification on 28.8.1995 and 29.8.1995, stock of 76.62 of M.S. Plates (final product) valued at a Rs. 11,89,650/- was found to be in excess of the stock shown in the statutory record. The excess M.S. Plates were seized. 5. Shri Yashwant Singh Bisht, DGM and Shri B.R. Bishnoi, Excise Officer of the Noticee No.1 in their respective statements accepted the shortage of 2620.800 MT Slabs and were satisfied with the manner of stock taking and they further deposed that this difference is due to actual non-receipt of slabs in the factory. They have received only duty paying documents. Physical verification of finished goods was also undertaken on 27.8.95, 28.8.95, and 29.8.95, during which a stock of 76.628 MT of plates (Final product) were found in excess and were seized by the officers. 6. Between 31.1.1996 and 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents were found to have been transporting tea on the particular dates and issuance of fake documents were admitted by all the concerned Noticees. Moreover, Shri Anup Bishnoi, Managing Director of M/s. BISCO in his statement dt.2.7.96 admitted the irregularities and also express his willingness to pay the duty evaded. 11. The matter was taken by the adjudicating authority, Indore vide adjudication order No.94/Commr./CEX/IND/2005 dated 28.11.2005. After analysing all the facts, statements of various suppliers and statement of Shri Bishnoi and statements of various transporters, he came to the conclusion that the goods i.e. MS Plates weighing 76.628 MT valued at Rs. 11,89,650/- and 88,120/- MT of MS waste scrap valued at Rs. 7,04,960/- seized at the factory premises of the Noticee No.1 M/s. Bhanu Iron and Steel Co. Ltd., Plot No.801,Sector-III, Pithampur were confiscated. However, I give an option to the Noticee No.1 to redeem the same on payment of Rs. 8 lakhs which shall be exercised within 30 days of the receipt of this order was given. A penalty of Rs. 5 lakhs (Rupees five lakhs only) was also imposed on the noticee No.1 under Rule 173Q of erstwhile Central Excise Rules, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts as well as ld. JCDR, Shri S.K. Panda, Appellants have raised in issue of non-supply of non-relied upon documents. I have examined the matrix of facts. It is seen that show cause notice was issued in 1997. Matter was adjudicated on 30.7.99 vide Order-in-Original No. 35/Comm/CE IND/99 on the ground of non-supply of non-relied upon documents, Hon ble CESTAT vide their Order No. A/289-300/200-NB dated 29.3.2000 remanded the case back to adjudicating authority for denovo adjudication for passing appropriate order as denial of principles of natural justice was observed as certain documents were not returned to the appellants and defence could not be prepared effectively. 17. In pursuance to Tribunal s order as above, there has been lot of exchange of letters between the appellants and the department and several dates were fixed for providing non-relied upon documents. 18. Commissioner has specified in para 24 to para 29 of his order that all out efforts were made to contact the noticee to take photocopies and inspect the records and also discussion about release of non-relied upon documents. In para 28 of the order, a reference has been made to the effect that out of 8 files, 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 95, 28.8.95 and 29.8.95 a stock of 776.628 MT of MS plates (final product) was found in excess which was seized. During a visit on 31.1.96 and 2.2.96, quantity of 88.120 MT of waste/scrap was found in excess of the stock recorded in RG-1 which was also put under seizure. From Investigations conducted from M/s.UAL, M/s.Belvedre Engineering Ltd., M/s.Bharat Industrial Structural Construction Ltd., it was found that these units were not having infrastructure to produce M.S.Slabs and they have merely issued invoices. The statement of Director confirmed that he was directed by UAL at he behest of Shri Bishnoi, Managing Director of BISCO to show the transactions only on papers. 21. Shri P.J.S.Bedi, Director of the unit, in his statement dt.27.6.96, recorded under section 14 of Central Excise Act, 1944 deposed that he was associated with M/s.BISCO as Executive Assistant to the Managing Director Shri Anoop Bishnoi. He had been directed to sign as Director of M/s.United Alloys Co.Ltd. at times, some papers signed by him were also blank papers/letter heads, He also stated that Shri Bishnoi on whose directions papers were signed, was not officially linked with M/s.UAL. Shri Bedi confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icity connection for manufacture of such heavy machineries said to have been manufactured and supplied by them. Shri Lalit Singhla in his statement dt.19.6.96 deposed that their unit was registered with DIC and the unit had no account in banks. 24. Shri Ranjan Stephen, Director of M/s. Belveder Engineering Ltd., in his statement dt.26.6.96 recorded under section 14 of the Act deposed that he was working as Dy.General Manager (Commerical) with BISCO, Delhi. He was director of M/s. Belveder Engineering Ltd. only on paper and was not involved in any activity of Belveder Engineering Ltd. He has not invested any money in the unit. Shri Stephen in his further statement dated 1.7.96 deposed that the unit did not have any facility to manufacture the goods in question. The goods from the Hissar units said to have been dispatched under the cover of documents issued by transporters namely M/s.Vishal Transport Co., Hissar. However, M/s.Mahavir Transport Co., Hissar and M/s.A.G.Transprot Co., Hissar. However, on investigation, the documents were either not found not issued or found fake. 25. Similar investigation in respect of inputs shown to have been received from Guwahati as well as Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MP-24 0892 LUNA Prushottam Mahobia S/o Chotelal Mahobia, VIII. Khairapara, Distt. Rajnandgaon. 4. MP-24 1072 Bajaj Super Vinita Chobey W/o A.K. Chobey, 10D Street 39, Sector-7 Bhilai 5. MP-24 0966 HGV TDV Harjeet Singh S/o A.S. Tansikka, Sunder Nagar, Near Gurudware, Bhilai 6. MP-24 A1545 TVS Champ Durga Nand Sahu S/o N.R. Sahu, Thana Bhilai Bhatti, Sector-3, Bhilai 7. MP-24 A1575 LUNA D.S. Vishwakarma S/o M. Vishwakarma, VIII Katro, P.O. Khapti, Dist. Durg 8. MP-24 A3683 LUNA Mr. Sushil Ray S/o Lakw RMD Ray, Nehru Nagar, East Bhila. 9. MP-24 A6575 HMV Open goods Shri Laxmi Carrier Corporation, 145,146 Akash Ganga complex supela Bhila 10. MP-24 A7811 Delivery Van (Bajaj) M/s Poddar agencies, Dail, Rajhara Dist. Durg. 11. MP-24 A8003 Articuh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the noticee company to secure ineligible credit. He admitted irregularity in respect of inputs and offered to pay duty to the department. In token of his acceptance, he also deposited Rs. 68 lakhs. 29. It is also on record that owner of the vehicle in respect M/s.Brahamputra Steels Pvt.Ltd. and M/s.Brahmaputra Tubes Pvt.Ltd. have admitted that their trucks have never been used for transportation from Guwahati to Pithampur. Owner of vehicle MP No.MP09-K-7091, stated that the vehicles were not even available during relevant point of time. 30. The Commissioner in para 61 of his order has relied upon the Tribunal s judgement in the case of Viraj Alloys Ltd. vs. CCE, Thane-II-2004 (177) ELT 892 (Tri.-Mum.). The para 11 of the said decision reads as under:- 11. In the present case the show cause notice is issued by ADG of DGCEI. He is competent to issue such a notice. The ld. Advocate s contention that if the authorities allege that the inputs were not received in the factory it is also obligatory on them to establish as to what happened to the duty paid inputs purchased and how the appellant could have produced the final products without the inputs is not tenable. In ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gular carriers of goods does not establish that the case of other vehicles also it was true. An exception cannot make a rule. Once it is established that the input has not been transported in the vehicle mentioned in the invoice it is but reasonable to say that the inputs were not received in the factory as required under Rule 57G. The Commissioner as well as the ld. SDR relied on the case of A.N. Guha Co. cited supra wherein the Tribunal held that it is not necessary for the department to establish a fact with mathematical precision once a presumption as to the existence of a fact is raised against an assessee. This test is satisfied in the present case. 31. In the case of Ranjeev Alloys Limited vs. CCE, Chandigarh-2009 (236) ELT 124 (Tri.-Del.), the Tribunal has held as under:- 9. At the outset we may observe that the question as to whether there can be transport of large quantities of iron steel items by light motor vehicles, like scooter, moped, jeep, car, tractor, tanker etc. can hardly be said to be an issue . There cannot be any dispute that for claiming Modvat/Cenvat credit there must be actual receipt of the goods and where the goods are alleged or shown to have b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, there is no merit in these appeals as no question of law, much less substantial, arises from the order of the Tribunal wherein pure findings of fact have been recorded in favour of the respondents . 11. It goes without saying that in any series of transactions some may be genuine for which the benefits available in law may be allowed to the party, for other transactions in the same series, similar benefit may not be allowed -depending on the attending facts in particular cases. In other words, Cenvat/Modvat credit can be allowed where there is actual transportation and receipt of goods by the manufacturer entitling them to take Cenvat credit, but where there is no such proof of actual transportation and receipt, credit cannot be allowed. Surely, it would be too wide to suggest that all transactions made by M/s. Adhunik Steels Limited involving M/s. Neepaz Steels (India) and others were fictitious. Each of such transaction has to be considered as separate and independent. The appellant therefore cannot contend that in view of the judgment of the Punjab and Haryana High Court - which was rendered between the same parties in the context of seemingly similar transactions, taking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details was duly communicated to the appellant as part of show cause notice - as referred to in para 12 of the Notice. We find substance in the submission of the Joint CDR that if annexure-I was in fact not sent to the appellant along with show cause notice - as stated in para 12 of the notice, the appellant should have made a grievance of it in their reply and asked for a copy of the annexure. We are thus satisfied that the appellant was in know of the relevant facts regarding particulars of the two vehicles referred to above which are subject matter of proceeding so far as the appellant is concerned. 15. Learned Joint CDR drew out attention to page 83 of the appeal paper book which is the photocopy of the invoice issued by TISCO, Mandigobindgarh in favour of M/s. Neepaz Steels (India) being excise invoice No. 500 dated 9-8-2000 for 23.880 MTs quantity of Scrap/Indul. Scrap Tandish Jam (2) showing vehicle number as PB 23 6412 in the column Mode of Transport/Veh./wagon No. Learned Joint CDR then invited our attention to the invoice issued by M/s. Neepaz Steels (India) at page 81 of the appeal paper book being invoice No. 67 dated 10-8-2000 in favour of M/s. Ranjeev Alloys Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ission is totally misplaced. From a bare glance it is evident that the words Truck No are printed portion of the column in the invoice against which PAT 8124 or PB-10F/9755 was typed. And so far as the vehicle numbers are concerned, the transport from M/s. Neepaz Steels (India) to M/s. Ranjeev Alloys Limited was shown to be by another set of vehicles, but if the transport of goods in question from TISCO, Mandigobindgarh to M/s. Neepaz Steels (India) was not possible and the same was fictitious, as found above, it is clear that there could not be further transport of goods to appellant M/s. Ranjeev Alloys Limited. At the cost of repetition it may be said that unless there is actual receipt of the inputs/raw material, the manufacturer cannot take Modvat/Cenvat credit. 19. It was submitted on behalf of the appellant that wrong description of particulars of the vehicle per se cannot be at ground to deny Modvat/Cenvat credit. It was also submitted that the mis-description could be result of clerical error. It was also submitted that the onus lay on the Department to prove that the goods were not actually received by the appellant. It was submitted that there is no evidence to suggest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the form of ship-breaking scrap was entered in RG 23A, Part-I does not establish that the goods were received in the factory. At least two truck owners have categorically denied having transported any goods to the appellant. The plea that the truck owners indulged in mal-practices and run them with false numbers is farfetched. In the appellants case 99 vehicles were such that they could not have carried the goods from the supplier to the buyer, some of the numbers belonged to auto-rickshaws, motorcycles and some numbers did not exist. The fact that out of the list of vehicles which were shown to be tankers, according to RTOs Office, two vehicles turned out to be regular carriers of goods does not establish that the case of other vehicles also it was true. An exception cannot make a rule. Once it is established that the input has not been transported in the vehicle mentioned in the invoice it is but reasonable to say that the inputs were not received in the factory as required under Rule 57G . 20. Learned Counsel for the appellant also took the plea that the extended period of limitation was not applicable. He submitted that the appellant was a bona fide buyer and should not s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g) Goods purported to have been sent from M/s Belveder Engineering Ltd, Hissar on invoices, were found not issued or found fake. (h) Detailed investigations conducted in respect of transportation of goods/materials have clearly indicated that such transportation were fake. All truck owners denied having undertaken any transportation. (i) Further investigations relating to transportations revealed a intriguing result as indicated in para 53 of the adjudication order that so called vehicles were LUNA, Trailer HGV, Bajaj Super, HGV TPV, TVS Champ, delivery Van (Bajaj), Bajaj Cub, TDV open, TDV Tanker were actually ficitious number as no such transportation actually took place. (j) M/s Anoop Bishnoi of Bisco in his statement dated 2.7.1996 clearly admitted the modus operands adopted by the company to secure ineligibile credit. 34. From the above investigations it clearly comes out that M/s BISCO has manipulated and created fictitious units so that invoices could be procured without movement of goods and subsequently credit is availed. 35. It is also observed that confessional statements by not one but by almost everyone including M.D., Directors, DGM clearly proved non-p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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