TaxTMI 
TaxTMI 
TaxTMI 
2019 (4) TMI 83
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....Trading & Agencies; (ii) Rakti Trading Pvt. Ltd; (iii) Yes Commtrade Pvt. Ltd.; (iv) S.R. Metalics; (v) Bright Metal & Steel; and (vi) RMS Steel Tech (Co-noticee Nos. 7 to 12). On the basis of information, the Department issued a show cause notice dated 26.05.2017 alleging that the assessee-Appellant is evading payment of Central Excise duty by availing Cenvat Credit on the basis of invoices issued by said First Stage Registered Dealers without actually receiving the goods i.e. MS Scrap from them. It was further alleged in the show cause notice that the said dealers had purchased the MS Scrap from various manufacturing units of Dhanbad, namely, Singh Minerals & Infratech; Singh Engineering Works; Supreme Multi Trade Pvt. Ltd; Visa Steel Industries; and High Tide Infra Projects Pvt. Ltd. which were non-existent and, therefore, the First Stage Dealers had only supplied invoices without supplying the material to the assessee-Appellant. It was the case of the Department that the amount paid against the purported invoices by the assessee-Appellant was returned in cash by the First Stage Dealers/Co-Noticees. The Revenue in this regard had placed reliance on the statement of Sh. Pradeep A....
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.... due diligence of the raw material/finished goods. It was the further submission of the learned counsel for the assessee-Appellant that they have produced the final product from the raw material (MS Scrap) purchased under the said invoices and removed the same after discharging the duty liability. The Revenue has not pointed out any irregularities in the account books of the assessee-Appellant and as such the allegation that no raw material (MS Scarp) was received is wholly erroneous and unsustainable. 7. The learned Counsel also submits that they have purchased the goods under proper invoices evidencing payment of appropriate amount of Central Excise duty, VAT & other taxes, and bonafidely entered the details in the dealer's register and thereafter, at the time of issue of Cenvatable invoices, paid the proportionate amount of duty, maintained proper accounts and filed returns, which were subjected to scrutiny by the jurisdictional Central Excise officers. It is his submission that for all the transactions of purchase and sale of the goods, payments were made through banking channel and the assessee-Appellant took reasonable care to purchase the goods from the registered dealers a....
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....pellant to verify their antecedents. However, the record discloses that during the period under consideration the said units were duly registered with the Department and, admittedly, the Excise registration was sought to be cancelled only on 17.02.2016. 10. The learned counsel also submitted that, during the course of search conducted at the premises of the assessee-Appellant, statements of Panchas, namely, Sh.Tushar M. Barwe and Sh.Pankaj Chauhan inter alia were also recorded and heavily relied upon by the Revenue, but the other Panch Witnesses were never made available for cross examination. Further, even the statement of Panch witnesses and Panchnama report failed to establish that the First Stage Dealers have not been carrying on any business from their registered premises. More so, both the said two Panch Witnesses, Sh.Tushar M Barwe and Sh.Pankaj Chauhan, were interested persons being employees of M/s Jayaswal Neco Ind. Ltd., who carried competitive edge. Learned Counsel has drawn attention to the answers given by Sh.Tushar M. Barwe during his cross-examination dated 19.04.2018, in response to following question:- Q.21. Is it correct that your employer M/s.Jayaswal Neco Ind....
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.... statement recorded by the Revenue has no evidentiary value and cannot be relied upon. To support his contentions, he heavily relied upon the ratio of the following case laws : 1. Jindal Drugs Pvt. Ltd. vs. Union of India 2016 (340) ELT 67 (P&H)]; 2. Manek Chemicals Pvt Ltd. vs. Union of India [2016 (334) ELT 302 (Guj)]; 3. Goyal Tobacco Co. Pvt. Ltd. vs. CCE & ST, Jaipur I [2017 (348) ELT 720 (Tri-Del) 12. The learned counsel further submitted that in terms of the provisions of Rule 9 of CCR, 2004, assessee-Appellant is required to verify the particulars as mentioned in the invoice issued by the First Stage Dealers and should be familiar with them. In this regard, he submitted that it would not be feasible for the assessee-Appellant to further check the records maintained by the First Stage Dealer during the regular course of business and to verify correctness thereof. In the present case, the assessee-Appellants have checked and verified the status of First Stage Dealers from whom the goods were purchased by them against the invoices of Dhanbad units. The transaction made by the assessee-Appellant was bona fide and a buyer can take only those feasible steps which are within h....
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.... (v) even with regard to Dhanbad Parties, the stand of Revenue is only that the said parties are no longer operational. Finally, the learned counsel for the assessee-Appellant submitted that the impugned order is passed on the basis of conjectures and surmises and deserves to be set aside. 14. The learned Counsels for the other Appellants consented to adopt the above arguments. 15. On the other hand, the learned Authorised Representative for the Revenue, while justifying the impugned order submitted that the assessee-Appellant has only received the invoices from the said First Stage Dealers to avail Cenvat credit without physical delivery of the raw material. On information, search was conducted by the Revenue and about 4000 odd duty paid invoices were seized from the premises of assessee-Appellant, on the basis of which Cenvat Credit was availed which were later found to be of non-existing manufacturing units. He submitted that Shri Pradeep Agarwal in his statement dated 07.10.2015 has stated that he had visited the premises of M/s Jetking Trading, Raipur and M/s RMS Steel Tech, Raipur, during the course of obtaining Central Excise Registration of these firms and admitted that t....