2011 (7) TMI 557

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d on that basis an alert notice was issued. Thereafter the proceedings were initiated against the appellant which culminated into the impugned order whereby the cenvat credit taken has been demanded with interest and penalty equal to the cenvat credit amount wrongly availed has been imposed under Section 11AC of Central Excise Act, 1944.   2. Heard both the sides. The learned advocate on behalf of the appellants submitted that appellant had taken credit on the basis of an appropriate invoice issued by the supplier. Admittedly appellant had received the goods and installed the same. The original adjudicating authority clearly observed that the fact of purchases made from the supplier and installation of the same in the factory of the....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....job workers were either non existent or they denied having manufactured the products for the supplier. In the absence of any manufacture of the goods supplied to the appellant, the documents issued by the supplier are totally invalid and the appellant failed to take necessary precautions to ensure that goods were supplied by the manufacturer and therefore the impugned order is sustainable.   4. I have considered the submissions made by both the sides. The cenvat credit has been denied and penalty has been imposed on the ground that the supplier did not have the infrastructure for manufacture of the goods. According to the facts that emerge from the adjudication order of the Commissioner, the supplier M/s. Ashok Electrical Stampings ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d not received any raw material. Since the supplier was a registered unit, and had paid duty from PLA as well as the cenvat credit and the department itself had failed to notice the fact that no goods were manufactured by the supplier for a period of five years, it is difficult to expect an assessee located in Karnataka to go and verify whether the manufacturer had the facility and whether he had really manufactured the goods before purchasing the same. The very fact that the supplier was in existence for 15 years, had availed cenvat credit of more than Rs.18 crores would show that the supplier did have some standing in the market. Since the cenvat credit availed by the appellant is reflecting the duty paid on the goods by the supplier for ....