TaxTMI 
TaxTMI 
2013 (9) TMI 649
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.... issued by the said unit. The issue regarding recovery of inadmissible refund from M/s. Matiz Metals Pvt. Ltd. is being dealt by Shillong Commissinerate. 2.2. The scrutiny of invoices by M/s. Matiz Metals Pvt. Ltd. revealed that they had issued several invoices without delivery of their finished goods to M/s. Shakti Enterprises, a Registered Dealer, Bhiwadi, Distt.-Alwar. Subsequently, the investigation against M/s. Shakti Enterprises was conducted by DGCEI, which revealed that M/s. Shakti Enterprises, a Registered Dealer entered the invoices of M/s Matiz Metals Pvt. Ltd. in their accounts and further issued cenvatable invoices to several manufacturers of articles of copper without receipt and without supply of any inputs to enable such manufacturers to fraudulently avail cenvat credit. Shri Subhash Chandra Gulati, Proprietor of M/s. Shakti Enterprises in his statements dated 07.12.2004 and 17.09.2007 admitted that they have received only invoices from M/s. Matiz Metals Pvt. Ltd. without the physical receipt of goods; that he issued invoices of M/s. Shakti Enterprises to different manufacturers of articles of copper as per directions of Shri Surendra Kumar Aggarwal, M.D. of M/s. M....
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....akti Enterprises; that he did not contact any person for transport of said goods; that payments of goods were made through cheques which were handed over to Shri Surendra Kumar Aggarwal. In reply to Q. No. 13 of his statement dated 28.04.2009, he stated that the original as well as duplicate copies of invoices of M/s Shakti Enterprises along with LRs were received by him from Shri Surendra Kumar Aggarwal, Managing Director of M/s Matiz Metals Pvt. Ltd. Shri Vishnu Kumar Agarwal in his said statement admitted that M/s. Matiz Metal Pvt. Ltd had issued only invoices without delivery of finished goods to M/s. Shakti Enterprises and subsequently M/s Shakti Enterprises have passed on Cenvat credit without sending the goods to M/s. Citizen Extrusion (P) Ltd. He further stated that he was unable to provide details regarding receipt of the goods in their unit and they have already reversed/debited the total sum of Rs.5,66,363/- in their Cenvat Credit account vide entry dated 17.07.2008. 3. Thereafter proceedings were initiated which culminated in confirmation of demand of Rs.5,66,363/- along with interest being the wrongly availed cenvat credit and imposition of penalty equal to the demand....
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.... Ld. A.R. would submit that department has shown clearly that M/s. Matiz Metals Pvt. Ltd. had only issued invoices and recovered money without supplying any goods. 5. He submits a copy of the adjudication order passed by Commissioner of Central Excise, Thane wherein demand for central excise duty collected by M/s. Matiz Metals Pvt. Ltd. without supplying the goods has been demanded and confirmed in proceedings vide order dated 5.6.12. He also submits that the fact that a show cause notice had been issued to M/s. Matiz Metals Pvt. Ltd. had been incorporated in the show cause notice itself. He also relies upon the decision of the Tribunal in the case of Bhagwati Steel Cast Ltd. to submit that it is enough if the department shows that there was no transportation and the fact that the dealers had not received the goods on which duty had been paid is also a factor to be taken into account. He also submits that cross examination of Shri Subhash Chandra Gulati cannot be made available at all since he is no longer alive and as regards the authorised signatory of the transporter, he submits that the transporter admitted the offence and was a co-noticee to the show cause notice issued and d....
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....r from the facts of the case that the director actively participated in availment of cenvat credit without receiving the goods and therefore penalties have been rightly been imposed. Further, he also submits that before the Commissioner (Appeals) Shri Gaurav Gupta, the authorised person on behalf of the appellants had admitted the wrong availment and had expressed willingness to pay interest and 25% of the amount demanded towards penalty within one month of issue of order in appeal. He had requested for reduction of penalty on the director. Therefore it is quite clear that by the time personal hearing was held by Commissioner (Appeals), the appellants had come to the conclusion that they had no case to defend and were seeking leniency in penalty against the director. 6. I have considered the submissions made by both the sides and gone through the records. 7. In paragraph 3.4 of the impugned order, the ld. Commissioner has observed as follows: Shri Gaurav Gupta, authorised person, on behalf of the appellants, appeared for personal hearing on 21.09.10 and contended that they have paid the wrongly availed credit. They are ready to pay interest and 25% penalty within one month of is....
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....e credit to the purchasers. Even though a copy of the show cause notice was supplied to the appellants, no affidavit from Shri Surendra Kumar Aggarwal has been filed. Even if cross examination was not allowed, nothing prevented the appellants from producing affidavits from their suppliers. Further appellants also did not make efforts to find out what was the case against M/s. Matiz Metals Pvt. Ltd. even though the fact of issue of show cause notice was mentioned. The show cause notice was issued to M/s. Matiz Metals Pvt. Ltd. and not to M/s. Shakti Enterprises alleging collection of excise duty without supplying goods and proposing to recover the same. Obviously Shri Vishnu Kumar Agarwal, the director of CEPL who was in touch with Shri Surendra Kumar Aggarwal, the director of M/s. Matiz Metals Pvt. Ltd. could not have been unaware or at least became aware subsequently of the nature of business to M/s. Matiz Metals Pvt. Ltd. Under such circumstances, the innocence of the Shri Vishnu Kumar Agarwal cannot be believed. 10. Moreover, it has to be noted that even the transporter has not chosen to contest the statement given by an employee who was no longer under him and has chosen not e....
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.... Pvt. Ltd. Therefore the department was right in asking for other evidence to show that appellant has actually received the goods. I find reliance of the ld. A.R. on paragraph No.27 of the Tribunal's decision in the case of M/s. Bhagwati Steelcast Ltd. in the order No.A/687-700/12/EB/C-II dated 15.06.12 is relevant and the same is reproduced below: 13. Therefore, in my view department has done enough in this case to show that goods have not been received and appellant failed to discharge the burden of showing that they had actually received the goods. 14. Reliance of the appellant on the decision of Hon'ble High Court of Gujarat in the case of Prayagraj Dyeing & Printing Mills Pvt. Ltd. & Ors. dated 28.09.12 is also not correct since the Hon'ble High Court took the view that where the appellant is not a party to the mischief/fraud/suppression etc. extended period cannot be invoked. In this case the manufacturer of the goods was M/s. Matiz Metals Pvt. Ltd.; the director was known to the appellant; the appellants received goods from a person unknown to them; why the goods travelled to Rajasthan to a depot to a dealer and thereafter to the appellant there is no answer; there is no a....