TaxTMI 
TaxTMI 
2013 (11) TMI 1532
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.... paid processed fabrics falling under Chapter 54 of the Central Excise Tariff. That it made certain exports of processed fabrics manufactured by Rivaa Textiles Industries Ltd. [hereinafter referred to as "processor"]. That the grey fabrics was purchased by the petitioner from M/s. Rivaa Exports Ltd. against Central Excise Invoices issued by supplier of grey fabrics in their name. These invoices were endorsed by the petitioner No. 1 M/s. Rivaa Exports in favour of the processor who took credit of duty reflected on the processor out of the credit so availed. The petitioner claimed rebate of excise duty against exports made under ARE-1 issued by the processor. 3.1 A large scale scam was unearthed, in 2005, in Surat wherein it was discovered that numerous excise invoices have been issued in the name of about 500 units which are non-existent and addresses declared fake. It was found that the reason for such invoices issued in the name of fictitious person was to avail Cenvat credit wrongly and claim abnormal and fraudulent rebate on exports. Alert circulars were issued by the Commissioner of Central Excise, Surat-I and also Director General Central Excise Intelligence declaring ....
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....al excise registration certificate. 4.1 Shri Joshi, learned counsel appearing on behalf of the petitioners has submitted that when the department relied upon the alert circulars issued by the concerned Commissioner, petitioner ought to have been given the alert circulars. It is submitted that in absence of providing the alert circulars at the time of adjudication, the OIO cannot be sustained. 4.2 It is further submitted by Shri Joshi, learned counsel appearing on behalf of the petitioners that as the payment of such weavers/processors was made through account payee cheques and the central excise invoices were also received by the petitioners from such processors who were holding central excise registration certificate, there was no justification of refusing rebate as the department has not established that the weavers/processors concerned were fake and fictitious. To substantiate that the amount was paid to the processors by cheques, Shri Joshi, learned counsel appearing on behalf of the petitioners has relied upon the documents at pages 159 to 310 [bank accounts of the weavers/processors]. Making above submissions, it is submitted that both the authorities be....
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....r to get the credit of CENVAT, Rule 7(2) cast a further duty upon the appellants/petitioners to take all reasonable steps to ensure that the inputs or the capital goods in respect of which they have taken the credit of CENVAT are the goods on which appropriate duty of excise as indicated in the documents accompanying the goods, has been paid. Therefore, it is requested to dismiss the present special civil applications. 6. Heard learned counsel appearing on behalf of respective parties at length. At the outset it is required to be noted that as such there are concurrent findings of fact given by all the authorities below that the invoices which were endorsed by the petitioners in favour of the processor who took the credit of duty reflected on processor were bogus, fake, fictitious and non-existing. It also appears that as such the alert circulars were issued by the Commissioner of Central Excise, Surat-I and also Director General Central Excise Intelligence declaring about 500 said units as fictitious, bogus, fake and the circulars were also issued for proper verification of claims of rebate. As observed by the revisional authority it appears that the said alert circulars w....
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....icant has not denied that the said suppliers are bogus, fake, fictitious and non-existing. Thus, the applicant has knowingly that no such suppliers existed, endorsed the fake invoices to the processors for facilitating availment of cenval credit and there after paying central excise duty therefrom. Applicants have contended that they have availed cenvat credit on the basis of duty paying documents and also cited C.B.E. & C. Circulars No. 703/19/2003-Ex, dated 25-3-2003. The applicant is ignoring the fact that C.B.E. & C. Circulars talks of genuine duty paying documents. In this case, the factitious duty paying documents are issued by bogus, fictitious and non-existing suppliers. No movement of goods have taken place as per finding in the investigations. The range Supdt. has also categorically stated that the grey fabrics suppliers are fictitious and non-existing. In such a situations, how the valid and genuine central excise invoices can be issued by such suppliers. As such, this argument of the applicant fails. 9. Applicants has also contended that the copies of alert circulars a relied upon documents were not supplied to them. In this regard, Government observes that the ....