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M/s Tribhuvan Industries Ltd. Versus Commissioner of Central Excise, Customs & S. Tax, Lucknow

2016 (5) TMI 1122 - CESTAT ALLAHABAD

Cenvat credit on purchase of raw material - sponge iron being the raw material/inputs purchased from registered dealer - goods received on endorsed invoices - goods were sold in transit - Held that:- From a perusal of the invoices in question, it is find that the so-called certificate (invoices) as mentioned in the Order-in-Original, in the invoices, has been mis-conceived by the adjudicating authority as a certificate by the appellant. In fact, it is certified by the seller of inputs - M/s Chac .....

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case of Revenue that M/s Chachan Metals Pvt. Ltd., Shamli, received the goods along with the endorsed invoices, which is a normal trade practice where goods are resold during transit. That there is nothing wrong in diverting the goods in transit by the same Company, that is M/s Chachan Metals Pvt. Ltd., Kanpur to their own office at Shamli. Further, find that it is an admitted fact that the revenue have accepted the taking of credit by M/s Chachan Metals Pvt. Ltd., Shamli. Accordingly, allow the .....

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cise Department and used to file returns required from time to time. During the financial year 2007-2008, the appellant had purchased sponge iron being the raw material/inputs from M/s Chachan Metal Pvt. Ltd., Shamli, Muzaffarnagar, a registered dealer under the Central Excise Act and had taken Cenvat credit amounting to ₹ 2,04,875/-. 3. An enquiry was made by way of audit by the Central Excise Audit Party in the premises of the Seller of the raw material, that is, M/s Chachan Metal Pvt. L .....

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me of audit nor thereafter was able to submit any proof regarding movement of material from Kanpur to Shamli, under the cover of the said endorsed invoices. According to the records, M/s Chachan Metals Pvt. Ltd., Shamli, had issued 10 invoices to the appellant-M/s Tribhuvan Industries Ltd., Lucknow. This information was communicated to the Asstt. Commissioner having jurisdiction over the appellant by the Suptd. of Central Excise in Shamli vide letter dated 28/8/2012. Based on this letter, show c .....

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15 of CCR read with Section 11 AC of the Act. 4. The appellant contested the show cause notice by filing reply. It was stated that credit was taken on receipt of inputs along with valid duty paying documents, namely, Invoices Nos. 19, 20, 21 and 22 all dated 18/9/2007 issued by M/s Chachan Metals Pvt. Ltd.. The invoices contained all particulars which are essential for the taking of Cenvat credit. The invoices issued by duly registered first stage dealers contained particulars of payment of duty .....

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to the appellant on sale of sponge iron. For any lapse on the part of M/s Chachan Metals Pvt. Ltd., Shamli to show the documents in support of transportation from Kanpur office to Shamli, cannot lead to adverse inference against the appellant. It was also pleaded that if there is any shortcoming on the part of the supplier, M/s Chachan Metals Pvt. Ltd., then revenue can take action on them but not on the present appellant under the facts and circumstances of the case. There is no malafide or co .....

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that in absence of fraud, collusion, et cetera on the part of the assessee or not established by Revenue extended period of limitation is not invokable. It was also held that the revenue case is based on assumption and presumptions and there is no material to proceed against the present appellant. It was further stated that, it was admitted by the revenue that the goods were received by the seller, M/s Chachan Metals Pvt. Ltd., Shamli, on endorsed invoices. Thus, the Revenue have found nothing .....

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hed at Shamli which is sufficient to prove that the sponge iron in question did reach at Shambli office of the supplier-M/s Chachan Metals Pvt. Ltd.. Reliance is also placed on the ruling of this Tribunal in the case of M/s Laxmi Metal Industries 2013 (287) ELT 487, wherein the Tribunal had observed that the goods have been received with proper documents showing payment of duty and there being no dispute about the credentials of the cenvatable invoices issued by registered dealer and accompanyin .....

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stage dealer and M/s Chachan Metals Pvt. Ltd., Shamli have not received the goods directly from the manufacturer located at Ramchandrapur, (Orissa) instead of the goods have been supplied by the manufacturer to M/s Chachan Metals Pvt. Ltd., Kanpur, who have further sentfor the said the goods to M/s Chachan Metals Pvt. Ltd., Shamli. As M/s Chachan Metals Pvt. Ltd., have failed to provide details of transportation from Kanpur to Shambli and moreover, transport documents/GR pertaining to the subjec .....

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rector of Tribhuwan Industries Ltd., 30 find that the goods under reference have been sent by them directly from the manufacturer, that is, M/s Orion Ispat Ltd. Orissa had on specific dates. The dates on which invoices by them were issued. It was further observed that invoice number 1238 dated 6/9/2007 issued by M/s Orion Ispat Ltd., Orissa, are ostensibly received by M/s Chachan Metals Pvt. Ltd., Shamli on 12/9/2007 (as per Sl.No. 22 of the RG-23 Register) whereas the certificate entries of inp .....

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received by the dealer at Shamli on 12/9/2007, they cannot claim to have the possession of subject goods at Ramchandrapur on 10/9/2007. Accordingly the invoices were held to be not proper duty paying documents as it appeared to revenue's that goods did not accompany with the Cenvatable invoices issued by M/s Chachan Metals Pvt. Ltd., Shamli. 6. Being aggrieved the appellant preferred appeal before ld. Commissioner (Appeals) who vide the impugned order dated 8/1/14 was pleased to reject the .....

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who transported the goods from Orissa to Kanpur and then onwards to Shamli. It is further urged that in view of the fact that the Revenue is satisfied with taking of cenvat credit by M/s Chachan Metals Pvt. Ltd., Shamli, there can be no disallowance in the cenvat credit taken by the appellant, duly passed by the seller to M/s Chachan Metals Pvt. Ltd., Shamli on sale of input to them, and further argued that without any contrary finding, the demand has been confirmed only on presumption and assu .....

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not attracted. Reliance is also placed on the ruling of this Tribunal in the case of S. K. Foils Ltd. Vs. Commr. of Central Excise, Rohtak : 2015 (315) ELT 258 (Delhi-Tribunal) wherein the allegation by the Revenue that the first stage dealer was not in existence under the fact that raw materials received by the assessee which were used by him in the manufacture of the final products on which appropriate duty of Excise was paid and monthly returns, were filed, it was held that the burden placed .....

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