Bogus invoices and no actual goods supply justify denial of Cenvat credit and extended limitation for fraud.

Cenvat credit was held unsustainable where invoices were issued without actual supply of goods. The invoices carried a vehicle description inconsistent with the quantities shown, and the supplier's proprietor stated that only invoices were issued and no goods were dispatched; those statements were not retracted. On those facts, the transaction was treated as fraudulent and the demand, interest, and penalty were upheld. The same fraud and suppression of material facts also justified invocation of the extended limitation period, so the limitation objection failed and the adjudication order was restored in full.

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Issues: (i) Whether Cenvat credit was wrongly availed on the strength of invoices issued without accompanying supply of goods. (ii) Whether the longer period of limitation was invokable in the facts of the case.

Issue (i): Whether Cenvat credit was wrongly availed on the strength of invoices issued without accompanying supply of goods.

Analysis: The invoices bore a vehicle number that was admittedly a Maruti Van, incapable of carrying the quantities shown in the invoices. The proprietor of the supplier had stated that only invoices were issued and no material was dispatched, and those statements were not retracted. The surrounding circumstances strongly supported the conclusion that the goods were never supplied and that the invoices were bogus.

Conclusion: The credit was fraudulently availed without receipt of goods and the demand was sustainable.

Issue (ii): Whether the longer period of limitation was invokable in the facts of the case.

Analysis: Once the availment of credit was found to rest on invoices issued without actual movement of goods, the transaction involved fraud and suppression of material facts. On that footing, the normal limitation objection raised before the lower authority could not stand.

Conclusion: The longer period of limitation was correctly invoked.

Final Conclusion: The order of the appellate authority was set aside and the adjudication confirming demand, interest, and penalty was restored in full.

Ratio Decidendi: Cenvat credit cannot be sustained where invoices are issued without actual supply of goods, and fraud or suppression arising from such conduct justifies invocation of the extended limitation period.

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