AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (12) TMI 83
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.... of the physical verification are as follows:- SI.No. Description of goods Stock as per RG-I Stock found on Physical Verification Difference Nos./% I. Arms Chair 15086 Nos. 15813 (+) 727 Nos./7.3% II. Chairs without Arm 3192 Nos. 3272 (+) 80 Nos./0.8% III. Crates PCC 818 Nos. 1214 (+) 396 Nos./3.4% IV. Plastic Scrap 18450 Kg 18624 Kg (+) 174 Kg/1.74% V. Baby Chairs 24732 Nos. 22260 Nos. (-) 2472 Nos./10% 3. The goods found in excess at SI No.I-IV above valued at Rs. 1,76,697/- involving duty of about Rs. 28,383/- found in excess of the recorded balance in RG-I were seized on reasonable belief that these were liable for confiscation. Goods mentioned at SI. No. V of the above table, valued at Rs. 96,408/- involving duty of Rs. 15,425/- was found short of the recorded balance in RG-I. Statement of Shri Sanjay Bolia was recorded, Sales & Dispatch Officer and also authorized secretary, of the appellants. He could not give logical explanation for the discrepancies found during the course of physical verification. He however, stated that the discrepancies may be due to accounting mistake on their part. 4. Accordingly show cause notice dated 9th September, 1....
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....w cause notice dated 16th March, 2000 was issued, which alleges that corporate office was also searched of the appellants on 18th March 1999. During the course of visit some incriminating documents were recovered and resumed under proper Panchnama. The appellant was purchasing plastic granules (PPCP or inputs) from M/s JK Enterprises (JKE for short) a dealer of IPCL, and M/s Reliance Industries Ltd. Patalganga, Maharashtra. On scrutiny of records it appeared that the appellants have availed and utilized Modvat credit fraudulently amounting to Rs. 61,78,804/- on 810.451MT of plastic granules shown to have been received against 84 invoices, as per Annexure 'A' to SCN, during the period 30th of March, 1997 to 16th of March, 1999, as it appeared that the appellants have not received such granules in the factory. The case of the Department is that the appellant had actually not received the 810.451MT granules on such 84 invoices. During the visit to the factory on 16th March, 1999 the officers have resumed two Registers, one, namely 'Gate Entry' and the other known as 'Vahan Register.' In the Gate Entry Register entries for all the trucks by which inputs were received were made, however....
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....f penalty was imposed under Rule 57 ibid. Further penalty was Rs. 5 lakhs, was imposed on Shri Shabbir Hussain Daud, whole time Director of M/s Peacock Industries Ltd. 8. Being aggrieved the appellants are before this Tribunal. The Learned Counsel for the appellants urges that the appellants received the inputs, manufactured finished goods and cleared the same on payment of duty. That there is no evidence at all that the inputs in question were diverted and some other inputs were procured from some other source for manufacturing the finished goods, which have been cleared on payment of duty. It is further urged that all the payments were made for purchase of the inputs by cheques. That there is no evidence led by Revenue of any flow back of money to the appellants. M/s JK Enterprises (the invoices of which are undisputed) have not admitted that only invoices were issued and goods not supplied. It was further urged that the appellants have received the inputs under dispute, have maintained proper records of the receipt by entering the details in Gate Register, thereafter in the 'goods received note' and the register for inputs, have utilized the same in production of finished produ....
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....ion numbers, cannot lead to the conclusion of non-receipt of raw materials in view of other overwhelming evidences on record. Further, the proprietor of M/s JK Enterprises Ltd. have confirmed the supply of inputs along with invoices. He has also confirmed that the invoices which correspond to the transport documents issued by some of the carriers namely M/s Chawra Road Carrier and M/s Kalwaniya Carrying Corporation were issued by them as the inputs were supplied from their godowns. As regards 24 invoices, goods were dispatched through M/s Ankita Road Lines. It is urged that M/s Ankita Road Lines is the regular transporter through whom the supplier-M/s JK Enterprises used to send the PP granules to the appellant. This has also been corroborated in the statement of Shri Ashok Kumar, proprietor of the M/s Ankita Road Lines. Non-keeping of proper records by the transporter cannot lead to the conclusion that the goods or inputs in question were not received by the appellants. As regards the 17 number of consignments transported by M/s Kalwaniya Carrying Corporation, the proprietor is Shri Omprakash of Kalwaniya Carrying Corporation confirmed the transport of inputs to the appellants. So....
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....was tentative and was yet to be executed. Thus, whatever the said note shown was just a suggestion of various alternatives. The amounts deposited in the bank accounts at Mumbai, wherein fact out of sale proceeds of the finished goods. Further, there is no case of the Revenue that such amounts deposited in the bank have not been accounted in the books of accounts maintained in the ordinary course of business. The deposits in the bank account confirms the legitimacy of such deposits or the transactions. The Learned counsel also relies upon the following rulings in support of its contentions:- (I) UKB Electronics Pvt. Ltd. V/s C.C.E., F.O. No.A/55931-55395/2016-EX [DB], dated 20/12/2016 passed by CESTAT New Delhi. (II) Hiren Aluminium Ltd. V/s C.C.E., [2009 (245) E.L.T. 386 (Tri. - Ahmd.)]. (III) C.C.E. V/s Parmatma Singh Jatinder Singh Alloys P. Ltd., [2012 (25) S.T.R. 281 (Tri. - Del.)]. (IV) Commissioner of C. EX., Raigad V/s Jay Iron & Steel Industries Ltd., [2015 (325) E.L.T. 130 (Tri. - Mumbai)]. (V) Motabhai Iron & Steel Industries V/s Commr. of C. EX., Ahmedabad-II, [2014 (302) E.L.T. 69 (Tri. - Ahmd.)]. (VI) Commr. of C. EX., Jalandhar V/s Bhawani Shankar Casting Ltd....
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.... 11. So far the dispute as regards receipt of inputs is concerned, we find that the appellants have made payment for such inputs through the banking channel. Further, other than bald allegation. There is no evidence of diversion of the raw materials. The reliance placed on the statement of the security guard is also misplaced as he had categorically stated that the 'Vahan Register' was being maintained by them at their sweet will and also there was no proper system of recording. Other security guards during the other shifts may not have always recorded the entry of trucks in the said Vahan Register. Further for all the invoices in dispute, proper entries have been found in the Gate Register, Goods Receipt Register (wherein entries were made after acceptance of the goods) with respect to all the transactions in dispute. Further, the stores officer of the appellant Mr. Jha, have also stated that the inputs/raw materials have always been received which are being disputed by the Revenue. We also find that the Learned Counsel have demonstrated during the course of argument that the goods have been received within normal time required for transport of the goods, in almost all case, whic....