TMI Blog2017 (6) TMI 632X X X X Extracts X X X X X X X X Extracts X X X X ..... s are indicated in the invoices of RM have been found to be none existent in the records of transport authorities. Consequently, it is to be held that the particulars given in the invoice regarding the vehicle numbers are untrue which make the entire document as not genuine. The verification with reference to other dealers also have established similar facts with reference to the vehicle numbers. It is very well established that in quasi-judicial proceedings, as in civil cases, the principal to be applied to evaluate the evidence is “preponderance of probabilities”. The standard is whether the proposition is more likely to be true than not true. The evidence brought on record by the Revenue, leads to the conclusion that no goods from the dealers in Mumbai, Bhiwadi and Delhi were received by AEPL. The credit availed by AEPL on the basis of invoices issued by various dealers is not admissible - appeal dismissed - decided against appellant. - E/3294-3296/2009-Ex[DB] - A/53839-53841/2017-EX[DB] - Dated:- 9-6-2017 - Shri Ashok Jindal, Member (Judicial) Shri V. Padmanabhan, Member (Technical) Sh. B. Garg, Advocate for the Appellant Sh. R.K. Manjhi, DR for the Respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayment of commission of ₹ 200-Rs 500 per truck by Shri Ishwar Singh Choudhary. Further, he stated that he never paid any freight charges to any transporter. 4. The department undertook verification of vehicle nos. mentioned in the LR/GR of SSFM said to have been used for transport of goods from Mumbai to Delhi. Many of the Delhi registration nos. were found to be non-existing in transport authoritie's records and a few were issued NOC s for other RTO s. In respect of many LR/GR s vehicles nos. were not found mentioned. 5. The Department undertook verification of vehicles shown in the invoices of RM which were shown to have been used for transporting goods from RM to AEPL. It was found that some of the vehicles were non-existing in the records of transport authorities, some were issued NOC s for other states. In respect of many vehicles registered with RTO of Faridabad, the details could be obtained as the records were lost in a fire accident. 6. The Department also undertook the verification of vehicle nos. used by few other dealers who had issued invoices showing supply of goods to AEPL. Many such vehicles were found to be incapable of transporting goods. Statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es covered Cenvat credit only amounting to about ₹ 18 lakhs. This evidence cannot be used to deny the entire credit availed by AEPL based on invoices of RM. v. The Department has alleged that no goods were received by RM from MTI Mumbai, since, these invoices were accompanied by GRs issued in the name of SSFM which was alleged to be a dummy unit whose GRs were procured by Shri Ishwar Singh Choudhary for commission. It has been submitted that RM or AEPL had nothing to do with the movement of goods from Mumbai to Delhi, and the same was the responsibility of the supplier of goods of Mumbai. It has also been submitted that Shri Ishwar Singh Choudhary had nothing to do with working of RM. vi. The Department has not alleged anything against the duty paid character of the invoices. Cenvat credit cannot be denied unless the duty paid nature of the documents is disputed. vii. The department has alleged that AEPL has procured SS utensils, sheets and patis and exported the same and claimed Cenvat credit on the inputs fraudulently. It has been submitted that all the goods procured by AEPL have been duly accounted in the books of accounts. Therefore, there was no room for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of duty) were exported under claim of rebate of duty paid on the inputs procured by AEPL. The case of the department is that the AEPL has availed Cenvat credit fraudulently by procuring only invoices which were not accompanied by goods. Substantial portion of the invoices based on which such credit is availed to the extent of about ₹ 62 lakhs have been issued by RM which is partnership firm with Smt Mitlesh wife of Shri Ishwar Singh Choudhary and Shri Sandeep nephew of Shri Ishwar Singh choudhary as a partner. 14. The Revenue has found that RM were procuring the goods from M/s. Metal Tube (MTI), Mumbai. RM has sold the entire goods only to AEPL. All the goods shown as received by RM from MTI have been accompanied by GRs issued by only one transport company SSFM whose owner is Shri Dinesh Chabda. In the statement given by Shri Dinesh Chabda, he has admitted that his company has never undertaken any business of transport of goods or paid any freight to any transporter for undertaking such transport of goods. He has also admitted that he allowed Shri Ishwar Singh Choudhary to make use of GRs in the name of his company in return for commission amounts ranging from S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt valid invoices are received. Since AEPL has availed Cenvat Credit without satisfying either of the above two conditions, such credits are irregular. 18. Revenue has relied upon the case law in the case of Bhagwati Steel Caste Ltd. Vs. CCE Nashik 2013 (293) ELT 417 (Tri-Mumbai). The facts of the case are similar to that in the present case and the allegation was availment of Cenvat Credit on the basis of dealer s invoices without receipt of goods. There was a difference of opinion between the Member (Judicial) who held that Cenvat Credit has been correctly availed on the basis of the invoices issued by the dealers. However, Member (Technical) took a different view and the matter was referred to the their Member who gave detailed findings and supported the view of Member (Technical). Since the decision has been given by a three Member Bench, the same is binding on this Bench. 19. In para 73.2 to 73.4 of the above decision, it was held as follows: 73.2 Rules 11 of the Central Excise Rules, 2002 stipulates that no excisable goods are to be removed from a factory or warehouse except under an invoice signed by the owner of the factory or his authorised agent. Sub-rule ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of input or capital goods purchased from a first stage dealer or second stage dealer shall be allowed only if such first stage dealer or second stage dealer, as the case may be, has maintained records indicating the fact that the input or capital goods was supplied from the stock on which duty was paid by the producer of such input or capital goods and only an amount of such duty on pro rata basis has been indicated in the invoice issued by him. Sub- rule (5) further stipulates that the burden of proof regarding the admissibility of the Cenvat credit shall lie upon the manufacturer or provider of output service taking such credit. Similar provisions existed in Rule 57A of the Central Excise Rules, 1944, Rule 7 of the Cenvat Credit Rules, 2001 and 2002. 73.4 From the above provisions of law, it becomes evident that to avail Cenvat credit, the inputs or capital goods should have suffered the stipulated duty by the producer/manufacturer of such goods and the goods should be received by the manufacturer availing credit in his factory and the inputs or capital goods so received should be utilised in or in relation to the manufacture of final products. In respect of inputs received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the factory premises carrying the iron and steel scrap and, therefore, the receipt of the goods is not established by the appellants. 74.4 The invoice stipulated under Rule 11 of the Central Excise Rules is not only an assessment document but also a transportation document. That is why the details relating to date and time of removal of the goods, mode of transport, registration number of vehicle, etc., are stipulated statutorily in the document. Since the entire excise duty regime is administered on self-assessment/self-removal basis, the sanctity of the assessment/transport document is paramount. The department has to establish their case only on the basis of the particulars declared in these documents. If the particulars given in the statutorily prescribed document are found to be untrue or incorrect, then an irrebutable presumption arises about the genuineness of the document and the transaction covered by the said document. If the particulars declared in the document are found to be untrue, the onus of proof shifts to the appellant-assessees to show that they have received the goods covered by the document. The evidence that can be led by the assessees are the GRNs or th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticulars but contains the details of duty or service tax payable, description of the goods or taxable service, assessable value, name and address of the address of the factory or warehouse or premises of first or second stage dealer or provider of taxable service, and the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, is satisfied that the goods or services covered by the said document have been received and accounted for in the books of the account of the receiver, he may allow the Cenvat Credit. As the main notice, i.e. the manufacturer had not filed any such application with the Assistant Commissioner / Dy. Commissioner of the Central Excise Division on receipt of the goods covered by invoices, where no vehicle no. was mentioned, it establishes the malafide intention on their part and proves the complicity of the suppliers and the buyer in the fraudulent act. Further Rule 9(5) of CCR 2004, stipulates that the manufacturer of final products or the provider of output services shall maintain proper records for the receipt, disposal, consumption and inventory of the input and capital goods in which the relevant in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the onus cast upon them regarding admissibility of the Cenvat Credit. We are in agreement with the above findings of the adjudicating authority. 24. It has been submitted on behalf of the appellants that Revenue has not carried out investigation in respect of the vehicles mentioned in the invoices. Consequently, it has been argued that the evidence cannot be used to deny the entire Cenvat Credit availed by AEPL. We note that Revenue has established that no goods have moved from Mumbai to RM and consequently, from RM to AEPL. A large percentage of the transport vehicles in respect of all dealers have been found to be incorrectly mentioned in the invoices. The question, therefore before us, is whether on the basis of available evidence, can we come to the conclusion that the demand is to be upheld. It is very well established that in quasi-judicial proceedings, as in civil cases, the principal to be applied to evaluate the evidence is preponderance of probabilities . The standard is whether the proposition is more likely to be true than not true. Lord Denning in Miller Vs. Minister of Pensions described it simply as more probable than not. The Apex Court in the case of Maha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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