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2016 (9) TMI 733 - CESTAT HYDERABAD

2016 (9) TMI 733 - CESTAT HYDERABAD - TMI - Cenvat Credit - bogus and fictitious invoices - allegation of non-receipt of imported goods into the factory premises - retraction of statement - import of scrap for manufacturing of M.S.Ingots & Cast iron rough castings - Held that:- Two different adjudicating authorities, one at the original stage and the second in de-novo proceedings ordered by the Tribunal, have concurred with the facts and allegations in the show cause notice and have inter-alia c .....

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ree paras to analyze and arrive at the conclusion reached, which in itself throws doubt on whether he has sufficiently applied his mind in the matter. - It is further seen that the raison detre for setting aside of the order of original authority is the finding of the Commissioner (Appeals) that he "is inclined to agree with the appellants" with regard to the various apparent discrepancies pointed out by the latter. I do not thus find any independent application of mind by the Commissioner ( .....

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umptions which the Commissioner (Appeals) relied upon while setting aside the adjudication order of the original authority. - In the cases of this nature involving illicit availment of Cenvat credit through false documents, the department is against heavy odds to unearth every stone of meticulously executed deception and innovative modus operandi. - Order of Commissioner (Appeals) cannot sustain - Demand confirmed - Decided in favor of revenue. - E/2843/2011 - Final Order No. A/30717/2016 - .....

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dit rules, 2001 and utilising the duty paid on the inputs namely scrap towards payment of duty on the final products. Acting on the information that assessee has irregularly availed of Cenvat credit on the Bills of Entry without receiving the imported scrap into their factory and fabricating the documents fraudulently, department the officers visited the above unit on 20-05-2003. During the verification of records, it was noticed that the assessees have wrongly availed an amount of Cenvat credit .....

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hennai Sea Port. 2. A show case notice dated 08-04-2004 was issued to the assessee inter-alia proposing recovery of ₹ 37,65,678/- towards irregular credit allegedly taken by them along with interest thereon and imposition of equal penalty under Section 11 AC of the Central Excise Act, 1944. 3. On adjudication, vide an Order-in-Original dated 13-04-2005, the adjudicating authority confirmed the proposals in the show cause notice. Personal penalty of ₹ 5 lakhs were imposed on Shri K.Ra .....

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rest from the assessee and imposed equal penalty under Section 11 AC ibid. On further appeal, the Commissioner (Appeals) vide Orders 6 & 7/2010 dated 21-05-2010, dismissed the appeals. The assessee approached the Tribunal for the second time and the latter, vide Final Order No.221 & 222/2011 dated 08-03-2011, remanded the matter back to the Commissioner (Appeals) with directions. 4. In this second round of de-novo proceedings, the Commissioner (Appeals) vide Order 23/2011 (V-ll) CE(Denov .....

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was shifted due to widening of the road and demolishing of shops. As held by the adjudicating authority, this argument cannot be accepted since the Sub-Post Master has categorically certified that the address given by the assessee is factious and bogus. The submissions made by Shri Rajendra Prasad cannot be accepted since the same was not substantiated by any documentary evidence. 5.2 On examination of the evidence, the adjudicating authority observed that in respect of the voluminous truck chi .....

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ed. 5.3 Regarding the contention that the Original adjudicating authority has ignored the statutory returns/records such as 57AE statements, RT 12 Returns, RG 23A Part I and Il and the RGI register which are periodically verified by the Range as well as Audit staff, it has no force or strength for the reason it is the case of the department that the assessee was indulging in fraud of availing Cenvat on fictitious documents. Hence the maintenance of records and filing of returns would not come to .....

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, the agent of the assessee, stated that according to the plan devised, Shri Ramesh has imported scrap approximately 4500 MTs in the name of SKDC and sold in Chennai itself. He got the lorry receipts books printed in the name of Shri Balaji Transport 572, GNT Road, Sholavaram, Chennai and M/s Andhra Tamilnadu Transport, 117, GNT road, Moolakadi, Chennai and used these fake lorry receipts to show that the imported scrap has been transported from Chennai to Yanam. The imported scrap was never tran .....

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Chennai and counsin of Shri Anil Ojha was closed down in mid-2000 and M/s Shakti Trading Company was used by Shri Anil Ojha for settlement of the transactions between and his companies and they have never made any payments to high sea sellers or M/s Shakti Trading Company, that Anil Ojha used to send the details to assessee for accounting purpose for which they have never made any payments, that statements of accounts of other high sea sellers M/s Arun Smelters, M/s Arun Vyapar and M/s Esteem A .....

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of nearly three years. Since it is proved that the assessee has fabricated the documents and taken credit on bogus and fictitious documents, it is a fit case to invoke proviso to Section 11A(1) of the Central Excise Act, 1944. Accordingly, the demand is liable for confirmation on limitation also. 5.7 Department has not made a case merely on presumptions and assumptions. All the persons connected with the case have admitted regarding the modus operandi followed by the assessees vide their statem .....

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reiterated the grounds of appeal and vigorously argued that it is a case where the nefarious intentions and action of the assessees have been adequately proved in the investigations. 7. The assessee was not represented. 8. This is the third round of litigation before this Tribunal. 9. Two different adjudicating authorities, one at the original stage and the second in de-novo proceedings ordered by the Tribunal, have concurred with the facts and allegations in the show cause notice and have inter .....

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s a mere three paras to analyze and arrive at the conclusion reached, which in itself throws doubt on whether he has sufficiently applied his mind in the matter. 10. It is further seen that the raison detre for setting aside of the order of original authority is the finding of the Commissioner (Appeals) that he "is inclined to agree with the appellants" with regard to the various apparent discrepancies pointed out by the latter. I do not thus find any independent application of mind by .....

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