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M/s. Liberty Whitewares Ltd. And C.C., Jaipur

2017 (11) TMI 755 - CESTAT NEW DELHI

Clandestine removal - shortage of 2420 pieces of water closet - Irregular availment of Cenvat credit - clandestine removal of 6847 pieces of finished goods - Held that: - with regard to water closet, the objections raised by the appellant with reference to the procedure adopted is nothing but an afterthought. During the statements recorded from various connected employees of the appellant company, no one could give any explanation regarding the shortage of goods found - demand upheld. - Irre .....

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efinition of input service under rule2(l) of the Cenvat Credit Rules 2004 - matter placed on remand. - Suppression of production and clandestine removal of 6847 pieces of finished goods - Held that: - After careful consideration of the invoices submitted by the appellant, it is concluded that these do not pertain to the goods and hence demand has been raised in the show cause notice - demand upheld. - Part matter on remand and partly decided against appellant. - E/53505/2014-EX[DB] - A/5 .....

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officers searched the factory premises as well as head office in Delhi on 20.12.2011 and recovered certain records considered as incriminating. The stock of finished goods in the factory was verified with the that in the relevant books and the statements of all connected persons were recorded. After conclusion of investigation in the case, proceedings were initiated against the appellants which resulted in the impugned order. The ld. Commissioner confirmed duty demands along with interest as we .....

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heard Sh. Mohan Lal, Advocate for the appellant and Shri H.C. Saini, DR for the respondent. 5. The ld. counsel for the appellant summarized the main grounds of appeal as follows: Pertaining to shortage of 2420 pieces of water closet: i) The demand on alleged shortages of water closet is not justified as the stock taking was done by the officers on eye estimation basis and it is humanly not possible to count 75688 pieces in half a day. The physical verification report has already been challenged .....

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ty on clandestine removal. Irregular availment of Cenvat credit: i) Demand for recovery of Cenvat credit is not justified as there is no dispute that service tax has been paid on input services received by them. ii) The Cenvat credit is legally admissible as these services are in the nature of input services. Merely because bills of service providers were issued at the head office address, the credit cannot be denied. iii) Non registration of head office address is a procedural lapse. Substantia .....

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he officers at the time of stock taking. ii) These goods were subsequently cleared on payment of duty partially and the rest were cleared for export. Even though necessary documentary proof was submitted to the adjudicating authority, the same was not considered. iii) Finally the ld. counsel submitted that the demands were not justified and may be set-aside. 6. The ld. DR appearing for the revenue justified the impugned order. He argued that at the time of stock taking in the factory, the Depart .....

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ISD for the purpose of transfer of credit. Accordingly, the credit availed on the input services is irregular. Some of the credit also pertains to ineligible input services such as foreign trips of the director, maintenance of sales outlets in the market etc. Finally he submitted that the impugned order may be upheld. 7. We have heard both sides and perused the appeal record. 8. First, we take up the demand of about ₹ 20 lakh confirmed on the alleged shortage of 2420 pieces of water Closet .....

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t the stock taking exercise. The same is also recorded in the Panchnama. Sh. Vashisht has also not expressed any dissatisfaction of the procedure adopted upon conclusion of the stock taking. In view of the above facts, we are of the view that the objections raised by the appellant with reference to the procedure adopted is nothing but an afterthought. During the statements recorded from various connected employees of the appellant company, no one could give any explanation regarding the shortage .....

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envat credit on input services. The appellant s headquarters is situated in Delhi but they have only one manufacturing premises in Neemrana. In respect of many input services, the invoices were received at their head office address. The service tax paid on such services was transferred by the head office to the appellant unit by way of invoices and Cenvat credit stands availed by the appellant on the basis of such documents. Adjudicating authority has recorded that the head office in Delhi has f .....

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s input services. But the adjudicating authority has recorded that the head office has transferred such credit in a consolidated manner without mentioning the details of the service providers from whom the services where received. It has further been observed that some of the credits are also clearly inadmissible such as credits on foreign trips of the Director, credits pertaining to maintenance of sales outlets etc. 11. In the facts and circumstances of the present case, we are of the view that .....

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les 2004. For this purpose we consider it necessary to remand this particular issue back to the adjudicating authority for denovo decision in the matter. The appellant is directed to produce all relevant invoices based on which such credits have been claimed. After scrutiny of these documents the adjudicating authority is directed to pass de novo decision in the matter. Additional documents may be admitted as per law and an effective hearing must be given to the appellant before passing such ord .....

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