TMI Blog2008 (9) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner dated 31-1-2006. By the said order, the Deputy Commissioner disallowed Cenvat/Modvat credit of Rs. 55,062/- under Rule 11AH of the Central Excise Rules, 1944 read with Section 11A of the Central Excise Act directing its reversal with interest under Section 11AB of the Act. Penalty of equal amount i.e. Rs. 55,062/- was also imposed under Section 11AC of the Act read with Rule 57AH and Rule 173Q of the 1944 Rules. 2. The appellant are engaged in the manufacture of Non-Alloy Steel Ingots falling under Chapter 72 of the Schedule to Central Excise Tariff Act. Brief facts of the case are that M/s. Tata Iron Steel Company Limited (TISCO) has a stockyard at Mandigobindgarh in the State of Punjab where they deal in various items of iron and steel viz tandish jam, pooled iron, bloom butt clear, hot strip mill, HSM coil box CO. rejected scrap ingot etc. The said stockyard is separately registered under Central Excise Act/Rules. TISCO appointed M/s. Adhunik Steels Limited, Mandigobindgarh as consignment agent. M/s. Neepaj Steels (India) at Mandigobindgarh also deals in iron and steel goods. Acting on information that Modvat/Cenvat credit was being fraudulently passed on and ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Adhunik Steels Limited, the latter collects materials from ex-steel works of TISCO, Jamshedpur which are brought to Mandigobindgarh on consignment basis by M/s. Adhunik Steels Limited. The maintenance of stocks at the stock-yard is entirely the responsibility of M/s. Adhunik Steels Limited till delivery to various customers on behalf of TISCO, Jamshedpur. The premises of the stock-yard are owned by M/s. Adhunik Steels Limited. The books of accounts of the stock-yard are also maintained by M/s. Adhunik Steels Limited who manage the staff and workers there. Shri Sushanta Banerjee further stated that their sales office at Jalandhar (now Ludhiana) issues offers to various customers of the materials and after receiving advance payments through cheques/drafts from them, issue delivery orders with intimation to the stock yard against which goods are delivered to the customer from there. M/s. Adhunik Steels Limited as the consignment agent is paid handling charges by TISCO, Jamshedpur. Shri Banerjee further revealed that the vehicles are arranged for transportation from stock-yard to the customer's premises by the customers themselves. Deliveries are made to them on ex-stock yard bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purchasers telephonically. He was asked about whereabout of Shri Sunil Kumar and he stated that he had passed away last year. 6. The statement of Shri Rattan Paul Bhatia, Director of appellant M/s. Ranjeev Alloys Limited was also taken on 13-12-2004. In response to a specific question put to him, he stated that they did not check the registration number of the vehicle. However, he claimed to have actually received the goods as per the invoice by trucks. He however admitted that the goods in question cannot be transported by light motor vehicles. He further admitted that the goods were transported and sent to them by M/s. Neepaj Steels (India) without issue of any GR etc. in support of the consignment. He failed to give any convincing answer to the question that in absence of any record showing dispatch of scrap/material by M/s. Neepaj Steels (India), the same could be received by M/s. Ranjeev Alloys Limited particularly when the vehicles shown in the invoices were incapable of carrying the materials. 7. On the basis of the said statements and the result of enquiry show cause notice was issued to the appellant as well as TISCO, Mandigobindgarh, M/s. Adhunik Steels Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... djudication or decision. If any issue is involved, it is an issue of fact - whether the vehicles in question are indeed light motor vehicles like scooter, moped, car etc. or they are transport vehicles like truck. Depending on the determination of this issue the Modvat/Cenvat credit can be allowed to the party subject to fulfilment and compliance of other requirements of law. In this view of the matter, one option available to us was to send the case back to the Single Member Bench for final disposal. But being prima facie of the view that the decisions of the Single Member Benches - referred to in the reference order - that credit cannot be denied merely on the ground that the vehicles mentioned in the concerned invoices are fictitious, was not correct - bordering on perversity, we decided to hear the appeal finally drawing support from the decision of the Division Bench in M/s. Viraj Alloys Limited (supra). 10. We are conscious of the fact that some of the decisions of the Single Member Benches referred to above were challenged by the Revenue in the Punjab and Haryana High Court by way of appeal under Section 35F of the Central Excise Act which were dismissed vide 2008 (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it of the case as an independent case notwithstanding favourable decisions in so called similar cases by Single Member Benches. As observed above, at the cost of repetition, if the vehicles in question were really light motor vehicles - incapable of carrying large quantities of steel and iron items, conclusion would be inevitable that there was no actual transportation or receipt of the goods and, therefore, the appellant could not have taken Cenvat credit on them - as held by the Division Bench in Viraj Alloys Limited (supra). 12. The vehicles in question by which the goods were allegedly transported on sale by M/s. Adhunik Steels Limited as consignment agent of TISCO, Mandigobindgarh are PB 23 6412 and PUV 1796. While the former was a tractor, the latter was a scooter. The appellant cannot contend to the contrary as the finding is based on the report of the concerned Regional Transport Officer after due verification. 13. Learned Counsel for the appellant however submitted that the invoices in question are documents of transactions between M/s. Adhunik Steels Limited on behalf of TISCO, Mandigobindgarh on the one hand and M/s. Neepaz Steels (India) on the other hand an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 dated 9-8-2000" i.e. the same invoice used by TISCO, Mandigobindgarh, in the column meant for the particulars of the supplier. It also mentions the name of the manufacturer as TISCO, Jamshedpur. 16. Learned Joint CDR made similar comparison between the invoices issued by TISCO, Mandigobindgarh in favour of M/s. Neepaz Steels (India) and by M/s. Neepaz Steels (India) in favour of the appellant M/s. Ranjeev Alloys Limited in respect of the other transaction which is subject matter of the proceeding against the appellant. The invoice of M/s. Neepaz Steels (India) in favour of M/s, Ranjeev Alloys Limited refers to receipt of goods by M/s. Neepaz Steels (India) from TISCO, Mandigobindgarh under invoice Nos. 501 and 502 dated 9-8-2000. Invoice No. 501 refers to transport of goods by vehicle No. PUV 1796 in the relevant column. 17. As the relevant particular in the two sets of invoices tally in all respects, it is established that what was sold and allegedly transported from the stock-yard of TISCO, Mandigobindgarh under Excise Invoice Nos. 500 and 501 dated 9-8-2000 to M/s. Neepaz Steels (India), was in turn allegedly sold and transported to appellant M/s. Ranjeev Alloys Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCO being fake and fictitious,-an allegation duly made known to appellant by the show cause notice read with Annexure-I thereto, the onus shifted onto the appellant to prove that the goods were duly received by them and used in the manufacture of iron and steel items. We are satisfied that the appellant utterly failed to discharge the onus. It is not in dispute that they took Cenvat credit of Rs. 55062/- on the basis of the alleged receipt of two consignments carrying contained duty liability of the said amount. Having failed to establish that they actually received the goods, they were clearly not entitled to take any Cenvat credit and therefore the impugned order directing them to reverse credit and confirming demand of Rs. 55062/- does not suffer from any illegality to warrant any interference. We are fortified by decision of the Division Bench in Viraj Alloys Limited (supra) and the following observations therefrom may be usefully quoted. "We observe that the department raised a presumption against the appellants by establishing that the inputs could not have been received in the factory in vehicles mentioned in the invoices. This allegation itself is based on the reports by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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