TMI Blog2018 (11) TMI 353X X X X Extracts X X X X X X X X Extracts X X X X ..... by the principal manufacturers and supplied to the appellants for the purpose of processing by endorsing the invoices. The appellant do not come in contact with the suppliers - in the SCN no specific charge or evidence of any suppression mis-declaration etc. on the part of the appellant has been pointed out - the demand of Cenvat Credit is set aside on the ground of limitation. Rebate claim to M/s Dolar Tek - penalty on M/s RTML - appellant has argued that Section 11AC of Central Excise Act, 1944 cannot be invoked to impose penalty as there is no demand raised in the said proceedings against the appellant - Held that:- It is seen that the SCN issued to the appellant in the said case only makes allegation regarding wrong availment of cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndorsed documents. The SCN alleged that the documents on the strength of which they had availed credit were issued by fake/ non-existent firms. It was also alleged that the appellant had not taken reasonable steps as per sub-rule (2) of Rule 7 of the CCR-2002. Ld. Counsel argued that alert Circulars dated 26.10.2004, 03.05.2005, 22.09.2005 and 06.07.2006 issued by Commissioner of Central Excise and Customs, Surat-I were not in their knowledge and were not circulated in the trade. He further pointed out that out of total demand of reversal of Cenvat Credit of ₹ 1,05,56,469/- an amount of ₹ 31,00,162/- was reversed while returning the grey fabrics received from certain principal manufacturers like M/s Sai Industries, M/s Saraswati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ELT 61 (Guj.). He also relied on the decision of Tribunal in the case of Shri Labdhi Prints 2018 (360) ELT 138 (Tri. Amd.). The appellant M/s RTML is also in appeal against penalty imposed on them in respect of rebate claim of ₹ 63,221/- filed by M/s Dololar Teks, a merchant exporter. 5. The allegation in the said case also was that the appellant had availed credit on the strength of invoices issued by bogus/ non-existent firm and paid duty from such credit. 6. Ld. AR relies on the impugned order. He also relied on the decision of Hon ble High Court in the case of M/s Diwan Brothers 2013 (295) ELT (387). 7. We have gone through rival submissions. On perusal of the SCN, we find that the appellant had availed Cenvat Credit on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raj Dyg. Ptg. Mills case (supra) and the demands had been confirmed for extended period of limitation, accordingly, the impugned Order is set aside and the appeal is allowed. In the case of Prayagraj Dyeing Printing Mills (supra) Hon ble High Court had discussed as follows: 12 . The next question is whether demand of reversal is barred by the period of limitation. In our opinion, in view of our above finding that if the original document is issued even by practising fraud, a holder in due course for valuable consideration unless shown to be a party to a fraud, cannot be proceeded with by taking aid of a larger period of limitation as indicated in Section 11A(1) of the Act. It is now settled law that Section 11A(1) is applicabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o demand raised in the said proceedings against the appellant. It is seen that penalty has been sought to be imposed under Rule 15(2) of the Cenvat Credit Rules, 2004 read with section 11AC of Central Excise Act. The penalty imposed under Section 27 of the Central Excise Rules, 2002 has been set aside by Commissioner (Appeals)) already. It is seen that the SCN issued to the appellant in the said case only makes allegation regarding wrong availment of credit without citing any evidence infact the SCN presumes that there are bogus/ fake suppliers and does not substantiated the said allegation by any evidence whatsoever. In these circumstances imposition of penalty under Section 11AC read with Rule 15(2) of the Cenvat Credit Rule is not sustai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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