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TMI Blog2017 (12) TMI 705X X X X Extracts X X X X X X X X Extracts X X X X ..... strial Estate, Gangyal, J & K and M/s Khazana Corporation Lane No. 4, Phase-II SIDCO Industrial Complex, Bari Brahmana, Jammu, M/s Aar Bee Industries, Lane No. 4, Phase-II, SIDCO Industrial Complex, Bari Brahmana, Jammu, M/s Jay Ambey Corporation, 66B and 67A, Birpur, SICOP Industrial comples, Bari Brahmana, Jammu and M/s. Tripti Menthol Industries, Lane No. 2, Phase-I SIDCO Industrial Complex, Bari Brahmana, Jammu. The investigation against the suppliers was also conducted which revealed that they had not carried out any manufacturing activities as these Jammu based units had further shown to have procured their raw material form Meerut based supplier which were found to be defunct and non-operative in the investigation conducted by Meerut-II commissionerate. The investigation against the supplier further revealed that the suppliers have not purchased any crude menthe oil from the farmers as their various branch offices/head office were found defunct/non-existence. The investigation against the supplier namely Shri Sai Commission Agency revealed that the said firm was never in existence at the given address or nearby area. The investigation conducted by Meerut and Jammu Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the fact that from the investigation was carried out at the end of suppliers, cases have been booked against them who availed Cenvat credit on fake invoices of non existence suppliers. Once supplier is held to be non-existent than it leads to inescapable conclusion that the goods have not been received, cannot be taken on the basis of bogus invoices of non-existent suppliers. Therefore, the impugned order is to be set-aside. 4. On the other hand, the Ld. Counsel for the respondent submits that statements of the co-appellants has been recorded, but, it was not investigated at the end of the respondent that whether goods they have received is under the cover of invoices issued by M/s VS and no investigation was conducted at the end of the transporters to ascertain the fact that whether the goods have been transported or not and the Revenue was not able to ascertain the real transaction between the respondent and the supplier, namely, M/s VS. The allegation in the show cause notice is only on the basis of presumption and assumption that the supplier issued invoices on which the respondent has availed Cenvat credit appears to be fake. As it is only the presumption of the respondent th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investigation was conducted at the end of the transporters when the vehicle number was entered in the invoices, name of driver etc. whether those vehicles have transported goods, from Jammu Commissionerate to the respondent unit. Moreover, no investigation was conducted at the check post to ascertain the fact that whether the vehicle in question has passed the check post Jammu commissionerate or not? 6.2. Further, I find that in the impugned order, the Ld. Commissioner (A) has examined the issue in detail and observed as under:- "8. On going through the show cause notice issued to the appellant and impugned order passed by the adjudicating authority, I observe that the department's case is based on the investigations conducted at the end of the supplier (VS) and the suppliers of supplier of the appellant in which it was revealed that the suppliers of VS or their suppliers had either not sent the raw materials to VS or were fake/non-existent firms and thus, the transactions between VS and their suppliers or between their suppliers and their suppliers (supplier's suppliers) were paper transactions and VS had actually not manufactured any goods but taken the benefit of area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... end in absence of corroborative evidence regarding non-receipt of inputs by the appellant, is justified. 9. If VS had not received the raw materials and had incorrectly availed the / credit or benefit of exemption notification and had actually not manufactured their final product and had issued the invoices only showing the duty payment on their final product, the appellant had nothing to do either with the VS or its suppliers. In terms of Cenvat Credit Rules, a manufacturer has to satisfy himself about the genuineness of the supplier of the goods from the identity and address of the manufacturer or supplier from his personal knowledge or on the strength of certificate given by the Superintendent of Central Excise having jurisdiction over the factory. Admittedly, the supplier i.e. VS was registered manufacturer having registration number printed on the invoices being issued by him. His identity, and address was also reflected in the said invoices. In such circumstances, the requirement of the rules also stands satisfied. A manufacturer cannot be expected to undertake investigations and to find out the truth behind the scene. As long as 1ic is receiving the goods from a known sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st thereon; imposition of penalty on the appellant for availing such credit and personal penalty on the manager." I do agree with the observations made by the Ld. Commissioner (A) in the impugned order that the short allegation of the Revenue is that the invoices against which the respondent have been availed Cenvat credit appears to be fake. In that circumstances, revenue has failed to prove that respondents have taken Cenvat credit on the strength of fake invoices but, it is only a presumption by the Revenue that the respondent has availed Cenvat credit on the invoices which appears to be fake invoice. The reliance placed by the Ld. AR in the case of Madhav Steel Corporation vs. State of Gujarat in tax appeal No.742/2013 dated 12.12.2013 passed by the Hon'ble High Gujarat High court is of no help to him. As in the said case, the Hon'ble High Court has held that allegations made must be specific, and the onus is on the Revenue to prove that the respondent has not eceived the goods. Admittedly, in this case the Revenue's allegation is on presumption and assumption basis, therefore it cannot be said the Revenue has made out a case against the respondent with admissible corrobor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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