TaxTMI 
TaxTMI 
2016 (12) TMI 389
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....t conducted investigations against M/s Reliance Cellulose Products (RCP) and M/s YM Drugs & Chemicals, Nalgonda district (YMDC) for availing fraudulent cenvat credit and other violations of the Central Excise Act, 1944. 1.2 In the process, simultaneous search operations were conducted at RCP, YMDC and also at the office premises of M/s Aerochem, M/s Aerochem Impex Pvt.Ltd. and M/s Finechem. The departmental Officers recovered certain incriminating documents. During the investigation it was observed that YMDC issued certain central excise invoices and paid central excise duty without actually sending any goods to the registered central excise dealers namely M/s Aerochem Impex Ltd. and M/s Aerochem. M/s Aerochem further issued the dealers ....
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....duced evidence to establish the proof of receipt of the material in regard to the impugned invoice and the usage of the material in or in relation to the manufacture of final products in their factory. The invoice under dispute is the dealer invoice No. 267, dated 03-08-2009 issued by M/s Aerochem, Hyderabad for supply of acetonitrile quantity of 1920 kg. He submitted that the appellant received the material in to the factory and after completion of necessary entries (gate entry)/verification which includes material weighment quality inspection, the appellants have accounted the material in their records (SAP system) and availed the credit of the duty paid. In support of the above, the appellant submitted copies of the gate entry, goods rec....
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....d. has stated that he has been working with M/s Finechem. M/s Aeorchem, M/s Aerochem Impex Pvt.Ltd. for the least 18 years ; that all the three firms belong to Shri Mukesh Vijay Warghi and Shri Rejesh Vijay Wargi and their family members, that he looks after the work of loading and unloading of material at the godowns of M/s Finechem, M/s Aerochem and M/s Aerochem Impex.Pvt.Ltd. 3. The Sr. Manager of appellant Shri K.Someshwara Reddy in his statement dated 19-04-2012 has categorically stated that appellant has received the supply of 1920 kg of acetonitrile as stated in the Invoice No.267 dated 03-08-2009 issued by M/s Aerochem. To establish the fact of receipt of material and the usage of them in the manufacture of final products, the ap....
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....al, as they pay excise duty amounting to around 24 crores per annum and their availment of credit also being substantially high and the foreign exchange earnings per annum also being in crores. He contended that the department has based their allegation on flimsy grounds and mere depositions of parties who are totally unconnected with the appellant. 5. On behalf of the department the Ld.AR Shri P.S.Reddy reiterated the findings in the impugned order. He stressed upon the conclusion of the investigations. He submitted that it was revealed from the investigations that M/s Y.M.Drugs procured certain commercial invoices through M/s Aeorchem Impex Pvt.Ltd. in the name of non existing firms such as M/s Mehta & Co. Mumbai and was shown in their....
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....tory. The allegations are founded on investigation conducted against other parties and the appellants herein have been implicated merely on the basis of assumptions drawn in regard to the evidences/materials pertaining to such parties. It is also to be mentioned that Shri S. Vinod Kumar who is associated with M/s Aerochem has deposed that he has been working with these companies for the last 18 years and was looking after loading and unloading of material at the godowns. This statement is in total contradiction to the case setup by department that no goods at all were supplied by M/s Aerochem and that all the transactions were being fabricated by issuing fake invoices only. This together with the fact that appellant has been discharging hug....