TMI Blog2018 (1) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... de by M/s.HSAL through the dealer M/s.Shivshakti Steels, were in the knowledge of the Department when first show cause notice was issued on 2.12.2008. This is evident from the fact that the statement of Ashok Bansal, partner in M/s. Shiv Shakti Steels was recorded on 19.11.2008 wherein he was questioned about these invoices. Hence, these two invoices could not be included in second show cause notice - demand in respect of 2 SCN set aside. The new facts relating to 24 invoices came to the notice of the Department only after second statement of Shri Dinesh Goyal - While some part of the investigation, in both proceedings are undoubtedly common, but the suppressed information relating to 24 transactions directly with M/s.HSAL between 18.2.2006 and 7.6.2006 were not included in his categorical statement given by Shri Goyal on 27.8.2008 and deliberately withheld. Hence I hold that the department is justified in invoking the extended period for the second show cause notice in respect of 24 invoices - the demand in respect of 24 invoices issued by M/s.HSAL is sustained. Penalty on M/s.NSP Forging Pvt.Ltd. - Held that: - since there was fraudulent availment of credit, suppression and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aled that they had also shown the purchase of raw material directly from M/s.HSAL involving Cenvat credit of ₹ 10,84,303/-. The department also recorded the statement dated 29.6.2006 of Shri Dinesh Kumar Goyal, Director of the appellant No.1 in which he stated that they had purchased goods from M/s.Shiv Shakti Steels in 2004-05 and 2005-06. The statement of Shri Ramesh Rawat, Executive Director of M/s.HSAL was also recorded in which he admitted categorically that they had issued invoices without sending any goods. In his subsequent statement dated 23.12.2009, Shri Dinesh Kumar Goyal, Director of the appellant No.1 stated that their firm was also issued show cause notice No.F.No.DZU/INV./F/204/2008 dated 02.12.2008 by DGCEI, Delhi for fraudulent availment and utilization of Cenvat credit amounting to ₹ 11,11,503/- for the invoices received from the said manufacturer during the period from 28.11.2003 to 27.11.2004. For the period subsequent to 28.11.2004, he also admitted his fault of wrong availment of Cenvat credit and undertook to deposit the same voluntarily. Shri Dinesh Kumar Goyal started that he understood thtat the material covered under these 24 invoices was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted that the penalty equivalent to the amount of Cenvat credit had been imposed under Rule 26 (1) of the Central Excise Rules, 2002. He argued that the penalty was not sustainable as the Director did not issue any invoice and the company was only recipient of the goods. He relied on the case law of M/s.Taj Forgings (P) Limited vs. CCE, Faridabad vide Final Order No.116/2016-CHD dt.21.01.2016 in appeal No.E/54489/14-SM. He also relied on the case law of CCE, Mumbai-I vs.Lal Mining Engg. Works-2007 (82) RLT 286 (SC). 4. Ld.AR appearing for the Revenue contended that the second show cause notice has correctly been issued as there was mis-statement by the Director in his statement dated 27.8.2008. In this regard, he invited attention to the para 3 of the impugned statement on page 229 of the paper book and stated that new facts, which were suppressed earlier, came to the notice only in second statement dt.22.12.2009. He also stated that the statement has not been retracted. He also stated that the dealer M/s.Shiv Shakti Steels was not involved in the first show cause notice. He further contended that the categorical admission of the Director that he had not received any materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period 28.11.2003 to 27.11.2004 was issued on 2.12.2008 in which the duty of ₹ 11,11,503/- was demanded. In the said show cause notice, the demand was based on the statement dt. 27.8.2008 given by Shri Dinesh Kumar Goyal, Director wherein Shri Goyal stated as below: Further on being asked specifically about the business transaction with M/s. HSAL, Sonepat, I state that we have business transaction with them since November, 2003, that we have availed a sum of ₹ 11,11,503/- on the invoices issued by them. On being asked, whether we have received any material from M/s.HSAL against invoices issued by them in the name of our company, I state that the material was provided to us by M/s. HSAL from local market at Faridabad but invoices were raised by them from the factory gate at Sonepat........ 11. Based on the above statement and other evidence, the show cause notices dated 2.12.2008 was issued, which was adjudicated resulting in confirmation of demand of ₹ 11,11,503/- and penalty was imposed of ₹ 2 lakh on the Director. Another statement of Shri Goyal was recorded on dated 23.12.2009 wherein he stated as under: I have been asked regarding purchas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the time of second show cause notice. In the instant case, it is evident that new facts relating to 24 invoices came to the notice of the Department only after second statement of Shri Dinesh Goyal. In the case of ECE Industries Ltd.(supra) subject matter of the two proceedings was similar and there was no suppression of facts unlike in the present case. The appellant have also referred to para 4 of stay order where the Bench had given prima facie finding on limitation. In this context, it is settled position in law that interim order is not binding in finally deciding an appeal. In this regard, Hon ble Supreme Court in the case of Amresh Tiwari vs. Lalta Prasad Duby another, 2000) 4 SCC 400 = 2000 5 SCC (Cri) 806 held as under: It is settled law that interim order, even though they may have been confirmed by the higher courts, never bind and do not prevent passing of contrary order at the stage of final hearing. Hence, the observations in stay order can have no bearing on the final order. 14. While some part of the investigation, in both proceedings are undoubtedly common, but the suppressed information relating to 24 transactions directly with M/s.HSAL be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il Kumar Gupta of M/s. Gupta Motors, Naraina, New Delhi in his statement dated 28.01.2010. The appellant have not disputed these statements of Shri Ramesh Rawat, Shri Vijay Kumar, Shri Dinesh Kumar and Shri Anil Kumar. Their only argument is that the appellant s name does not figure in the statement of Shri Rawat and the statements of drivers were not recorded. I find that the statement of Shri Ramesh Rawat clearly brings out that goods were only sent to Jodhpur and no goods were transported to Faridabad where only invoices were sent. Besides, there is admission by Shri Dinesh Goyal, Director that material received in these 24 invoices was not manufactured by M/s. HSAL. I also find that the evidence from the transporter companies is further corroborative and clinching. Hence, non -recording of statements of drivers does not create lacunae in the case of Department. 16. I find that Sh. Ramesh Rawat Executive Director of M/s HSAI in his statement dt. 29.6.06 has categorically admitted that no goods were supplied by them but only invoices were supplied to various dealers and manufacturers so as to pass on the fraudulent Cenvat credit. The transporters in their respective statements ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsignments are filled by the originating point. It is not the case that any Government agency supervises the movement of goods under the cover of Form 38. On perusal of the copies of Form 38 brought on record by the appellants, I do not find any endorsement by Stage Agency to the effect that the goods covered under the said Form 38 were delivered under their supervision. The particulars filled in Form 38 at best can be equated by issuing an invoice under Rule 11 of the Central Excise Rules, 2002, where the person issuing invoice himself fills the details of the goods covered under it. Rather I find that the act of HSAL amounts to breach of trust deposed upon them where they were supposed to act in a bonafide manner, which they have failed to do. 19. I also find that the appellant have relied upon the judgement of the Hon ble Allahabad High Court in the case of CCE Vs. Juhi Alloys Ltd. (Supra). In the said case, the assessee was engaged in the manufacture of MS bars, rounds etc. and had procured raw material from M/s. MK Steels (P) Ltd. The inputs covered by the invoices raised by M/s.MK Steels (P) Ltd. were received by the assessee and entered in Cenvat credit account. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by the dealer and there was proof of their use in manufacture. On the contrary, in this case, it has been admitted by Director that the 24 invoices were not accompanied by the inputs manufactured by M/s.HSAL and were therefore bogus invoices. The appellant have also relied on CCE, Chandigarh Vs. Hitkari Industries Limited-2008 (226) ELT 583 (Tri.-Del.), which is a Single Member decision; besides the said case was booked on the basis of invoices issued by a dealer, who did not have records of consignment in his sales tax registers. However, on specific verification with Sales Tax authorities submitted details of consignments that crossed the Parwanoo border and the payments were made by cheque. No such verification was done in this case in view of clear admission by the Director and there is no proof of payment for the goods, which never accompanied the invoices. Hence, this decision does not help the appellant. For the other case relied on by appellant CCE, Chandigarh Vs. Neepaz Steel Ltd.-2008 (230) ELT 218 (P H), the inputs supplied by the dealer were received by the manufacturer and used in the manufacture of goods cleared on payment of duty. On the contrary, in this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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