2018 (12) TMI 427

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....though they had not manufactured the same. Show cause notice dt.10/6/2003 was issued demanding duty alongwith interest on the inputs cleared as such and also proposing to appropriate the amount of Rs. 2,87,986/- paid by them on 14/2/2000. After due process of law, the original authority confirmed the demand alongwith interest and also imposed penalties. In appeal, the Commissioner (Appeals) upheld the same. Hence this appeal. 2. On behalf of the appellant, the Ld.Counsel, Sh.M.N.Bharathi submitted that the period involved is from 24.8.1998 to 24.3.1999. During this period, the erstwhile MODVAT Credit Rules were in force. As per 57 F of the said Rules, the appellant can remove the inputs as such on payment of duty equal to the amount of c....

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....ted that the appellants had cleared the items to other persons as well as their Head Office, where no manufacturing activity was taken place. The invoices cannot be relied, as these are fake invoices. These documents cannot be accepted for payment of duty. The inputs having been removed as such in the guise of Ephedrine tablets, the demand and penalties imposed are legal and proper. 4. Heard both sides. 5. On going through the records, it is seen that the investigations were started on the premises of the diversion of controlled substances (Ephedrine) from the factory. The period involved is from 24.8.1998 to 24.3.1999. The said substance was notified as controlled substances vide SO 1296 (E) dt.28/12/1999 only. Thus the investigation....