Revenue appeals dropping of Cenvat Credit demand based on bogus invoices. Onus on claimant to prove receipt.

The appeal was filed by the Revenue against the dropping of demand for Cenvat Credit taken by the respondents based on bogus invoices without physically receiving the goods. The Commissioner (Appeals) dropped the demand, holding the appellants cannot be faulted for the supplier's actions. The Revenue argued credit was denied on invoices without duty debited and goods not received. The judge found discrepancies, emphasizing the separate proceedings against the supplier and appellant. The onus of proving receipt lies with the credit claimant, and the matter was remanded for a fresh decision by the Commissioner (Appeals).

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Issues:
- Appeal against dropping of demand for Cenvat Credit taken on the strength of bogus invoices.
- Whether the appellants can be faulted for supplier's failure to deposit duty with Revenue.
- Denial of credit on invoices without duty debited and goods not physically received.
- Onus of establishing receipt of goods on the appellants.
- Separate proceedings against supplier and appellant, and the relevance of evidence in each case.

Analysis:
- The appeal was filed by the Revenue against the dropping of demand for Cenvat Credit taken by the respondents on the basis of bogus invoices issued by a supplier, without physically receiving the goods in their factory. The original adjudicating authority confirmed the demand, but the Commissioner (Appeals) dropped it, holding that the appellants cannot be faulted if the supplier collected duty but failed to deposit it. The penalty was upheld on the supplier, not the appellants.

- The Revenue argued that credit was denied on invoices without duty debited by the supplier and goods not received by the appellants. The onus of proving receipt of goods was on the appellants as per Rule 9 (5) of the Cenvat Credit Rules. The Revenue presented evidence, including a report showing the goods were never received, and vehicles listed in invoices were incapable of carrying such materials. The Commissioner allegedly accepted the appellants' claim without evidence, and the penalty should have been imposed on the director of the appellant company.

- The respondent's counsel highlighted that a show-cause notice was issued to the supplier, and the order confirmed that the appellant availed credit after receiving goods. No penalties were imposed on the appellants in the notice. The counsel argued that the Revenue accepted the order regarding the supplier, so a different view cannot be taken in the appellant's case.

- The judge noted that the evidence and proceedings against the supplier and appellant were separate. The investigation against the supplier did not include details about the vehicles used for transport, unlike the appellant's case. The judge emphasized that conclusions from one proceeding cannot be applied to another when the evidence and circumstances are different. The judge found discrepancies in the list of vehicles provided, suggesting the goods might not have been received in the factory. The onus of proving receipt lies with the person claiming credit, and the Revenue had discharged its liability. The order was set aside, and the matter was remanded for a fresh decision by the Commissioner (Appeals).

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