TaxTMI 
TaxTMI 
2015 (1) TMI 216
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....Cenvat credit of Rs. 1,65,962/- on the basis of two invoices issued by M/s Steel Mongers (India) Pvt. Ltd., a second stage dealer. One invoice was in respect of supply of HR Coils involving duty of Rs. 79,117/- on the basis of which the credit of the same amount was taken by the appellant company. The second invoice in respect of supply of CR sheets involving duty of Rs. 86,845/- on the basis of which the credit of the same amount was taken by the appellant company. M/s Steel Mongers (India) Pvt. Ltd. in these invoices issued by them to the appellant company, have shown supply of the goods from the first stage dealer namely M/s Bhagwati Trading Company and M/s Ayushi Steels Company Pvt. Ltd. and the manufacturer from whom the first stage de....
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....ompany under Rule 13/15 of Cenvat Credit Rules, 2002/2004 readwith Section 11AC of Central Excise Act, 1944 and imposed penalty of Rs. 79,117/- on M/s Bhagwati Trading Company, penalty of Rs. 86,845/- on M/s Ayushi Steels Company Ltd. and penalty of Rs. 1,65,962/- on M/s Steel Mongers (India) Pvt. Ltd. under Rule 25 (1) of Central Excise Rules, 2002. The appellant was also given an option to pay reduce penalty equal to 25% of the Cenvat credit demand within 30 days of the receipt of the order in accordance with the proviso to Section 11AC. The appellant company had paid the entire amount of disputed Cenvat credit even before the issue of show cause notice alongwith interest and after issue of the adjudication order also paid 25% of the amou....
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....t absolutely no inquiry has been conducted with M/s Steel Mongers (India) Pvt. Ltd., that in absence of any inquiry with M/s Steel Mongers (India) Pvt. Ltd., and with the transporters, and merely on the basis of the investigations conducted in respect of M/s Pasondia Steel Profiles Ltd. it cannot be alleged no goods had been supplied by M/s Bhagwati Trading Company, that Shri Rupesh Bansal, in his statement has named the companies to whom bogus invoices had been issued without supply of any material and the name of M/s Steel Mongers (India) Ltd. does not figure in the list of the companies mentioned by Shri Rupesh Bansal, that in view of this, it cannot be alleged that M/s Bhagwati Trading Company and M/s Ayushi Steels Company Ltd. had issu....
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....of M/s Pasondia Steels Profiles Ltd. it was clear that during the period of dispute there was no manufacturing activity in that company and only bogus invoices had been issued to various dealers without supply of any material and when no goods had been received by the first stage dealers M/s Bhagwati Trading Company and M/s Ayushi Steels Company Ltd., they could not have supplied the materials mentioned in the invoices issued by M/s Pasondia Steel Profiles to M/s Steel Mongers (India) Pvt. Ltd. and M/s Steel Mongers (India) Pvt. Ltd. could not have supplied those goods to the appellant company. With regard to the penalty on M/s Friendz Auto Ltd. and M/s Steel Mongers (India) Pvt. Ltd., he pleaded that merely because wrong Rule has been invo....
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....as M/s Pasondia Steel Profiles Ltd., Ghaziabad. In respect of M/s Pasondia Steel Profiles Ltd., there was an investigation by the Department in course of which it had been revealed that while they were purchasing HR Coils, the same were being sold as such but they were still availing Cenvat credit of the same by showing the HR Coils were used in the manufacture of CR Sheets, while there was no such manufacturing activity and they had passed on such wrongly availed Cenvat credit to a number of dealers including M/s Ayushi Steels Company Ltd. and M/s Bhagwati Trading Co. by issuing bogus invoices without supply of any CR Sheets. Since in this regard an order has also been passed by the Tribunal reported in 2011 (263) E.L.T. 673 (Tri. - Del.....
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....credit of Rs. 79,117/- on the basis of the invoice of M/s Steel Mongers (India) Pvt. Ltd. regarding supply of HR Coils is not correct and to this extent the impugned order has to be set aside. 8. In view of the above discussion, so far as the Cenvat credit demand is concerned, the Cenvat credit demand of Rs. 86,845/- is upheld but the impugned order confirming the Cenvat credit demand of Rs. 79,117/- is set aside. 9. Coming to imposition of penalty on the appellant company, since they have wrongly availed Cenvat credit of Rs. 86,845/- in respect of CR Sheets while as discussed above, had not been received by them, penalty would be imposable on them in terms of Rule 15 (2) readwith Section 11 AC. However, since the entire amount of Cenvat ....