TaxTMI 
TaxTMI 
TaxTMI 
2017 (7) TMI 405
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.... M/s.S.K.Garg & Sons (first stage dealers) and the second stage dealer M/s.Sukhdev Steel Rolling Mills. The Revenue conducted investigation and found that the office/godown premises for which registration was granted to M/s.S.K.Garg & Sons was not in control/possession/ under rent by the dealer at the material time and they had issued invoices without having any known office or godown to store the excisable goods and thus the appellant appeared to have indulged in paper transactions. A show cause notice was issued and the demand of Rs. 31,05,356/- along with interest was confirmed. Penalty of Rs. 31,05,356/- was also imposed. 2. Learned Advocate for the appellant submits that on the basis of same investigation a show cause notice was issue....
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....led because the dealer had presented fake and bogus rent receipt and rent deed in order to obtain the registration as registered dealer. The possession of the godown of the dealer was not established and there was fraudulent registration on the basis of which the dealer was making fake and false transactions. Inputs were not purchased except only paper transactions were made. 6. The entire modus operandi is summarized in para 1.16 (iii) & (iv) of the adjudication order: "(iii) Despite not having any office/godown to store the goods the Dealer had issued Cenvatable invoices to the Noticee after showing the storage of the goods. As mentioned above, the Dealer did not have any godown. Thus only the invoices were issued to Noticee without any....
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....(iv) are also relevant and are reproduced below: "4.2 (i) The statements of Prem Chand and Shri Sanjeev Kumar Garg dt. 16.08.2007 relied upon in para 8 & 9 of show cause notice respectively have no contradictions which indicate that these were voluntary statements. In fact whatever has been stated in the statements is duly corroborated by other statements or other evidences. The relevant portion of the statement relating to the godown rent receipt and rent deed, based on which registration of M/s. S.K. Garg and Sons was cancelled is duly supported by the statement of landlord of godown Shri Prem chand who in his statement dt. 16.08.2007 clearly stated that they never rented godown to anybody and denied having signed the rent deed. The stat....
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.... which duty has been paid and therefore these invoices appears to have been issued by the dealer without receipt, dispatch and storage of duty paid goods. (iii) As per provisions of Rule 7(2) of CCR 2002 and rule 9(3) of CCR 2004, the manufacturer taking Cenvat Credit is required to take all reasonable steps to ensure that the goods in respect of which Cenvat Credit has been taken are goods on which appropriate duty of excise has been paid. In terms of these statutory provisions, the manufacturer is expected to satisfy himself about the identity and address of the supplier. In this case, the noticee had not taken any steps for conducting verification regarding identity and address of the dealer. As per investigations, the dealer neither ....
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..... - 1996 (86) E.L.T. 460 (S.C.) and in Delhi Development Authority v. Skipper Construction Company (P) Ltd. - AIR 1996 SC 2005]. Any undue gain made at the cost of Revenue is to be restored back to the treasury since fraud committed against Revenue voids all judicial acts, ecclesiastical or temporal and DEPB scrip obtained playing fraud against the public authorities are non est. So also no Court in this country can allow any benefit of fraud to be enjoyed by anybody as is held by Apex Court in the case of Chengalvaraya Naidu reported in (1994) 1 SCC I : AIR 1994 SC 853. Ram Preeti Yadav v. U.P. Board High School and Inter Mediate Education (2003) 8 SCC 311." - - - - - - - - - -- - - - - - -- "21. Fraud and justice do not dwell together ....
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....ny evidence as to when the goods were purchased by the dealer to ascertain whether the storage of the goods required or not and the Commissioner (Appeals) rightly held that the appellant failed to substantiate that the goods purportedly sold to the appellants by the dealers directly to second stage dealer were from stock on which duty has been paid. 10. I also find that Commissioner (Appeals) was inclined to give benefit of transit sale i.e. sale not requiring storage but the same could not be given as no documentary evidence substantiating the transit sale was produced by the appellant. 11. I find that the appellant has relied on orders which have passed by the Single Member of the Tribunal wherein the evidence does not appear to be reco....