2018 (12) TMI 429 – CESTAT HYDERABAD – TMI – CENVAT Credit – fake invoices – only invoices issued without receipt of goods – Demand alongwith interest and penalties – extended period of limitation – principles of natural justice – Held that:- The investigation did not take place at the end of the transporters, no statement was recorded of any individual from Padmashri Road Lines, and it is seen from the impugned orders that the adjudicating authority as well as the first appellate authority are not disputing the existence of such consignment note nor it is alleged that this consignment note is a fake – In the absence of anything to discredit consignment note of Padmashri Road Lines which carried the material from Vadodara to Hyderabad, it is difficult to accept the revenue’s view point that the main appellant had availed CENVAT credit only on documents.
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This view is fortified by the decision of the Tribunal in the case of Dhakad Metal Corporation [2015 (8) TMI 146 – CESTAT AHMED
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y issuing the invoices and materials were not supplied. It is the case in the show cause notice dated 30.12.2015 that main appellant during May, 2013 availed CENVAT credit of ₹ 4,45,499/- without receipt of material and hence they issue show cause notice for reversing of the same along with interest and also sought to impose penalties on individual who is the Director of main appellant and M/s Benzo Petro International Ltd for such activity. Appellants contested the show cause notice on merits and also on limitation. Appellant produced before the lower authorities the purchase orders placed by them, the consignment note issued by transporters i.e., Padmashri Road Lines, the goods receipt note and the material issued notes as also filing monthly returns filed with the authorities indicating the receipt of the material. It is also the case of the appellants before the adjudicating authority that they have received the material, manufactured the finished goods and removed the same o
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he has produced documents indicating the receipt of the materials and the consumption thereof. On limitation, it is his submission that they have always kept the department informed about the receipt of the material and also to buttress his argument that they have received the raw material, he would state that they would not have manufactured and cleared the finished goods on payment of duty in the absence of any raw material. 4. Learned department representative, on the other hand, submits that there was a DGCEI enquiry which revealed that Benzo dealers had no facility or procured any materials or processed any materials but only issued Central Excise invoices clearing waste and useless materials through the dealer. He would rely upon the statement of the Executive Director of Benzo dealer, General Manager of Arch Pharma (main appellant) and Shri Manoj Jain (Director of the main appellant) wherein they have admitted that they have not received the material. 5. On careful consideration
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RG-23 Part-I to the authorities during the relevant period. It is also seen from the records that main appellant while filing monthly returns has shown the clearances of the finished goods manufactured out of goods received from the dealers. On this overwhelming evidences which are on record, the lower authorities have relied upon the statements of the individuals and has also on the Executive Director of Benzo dealers to hold against the appellant that they have availed ineligible CENVAT credit. 6. On specific query from the Bench, both sides agreed that the investigation did not take place at the end of the transporters, no statement was recorded of any individual from Padmashri Road Lines, and it is seen from the impugned orders that the adjudicating authority as well as the first appellate authority are not disputing the existence of such consignment note nor it is alleged that this consignment note is a fake. In the absence of anything to discredit consignment note of Padmashri R
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