2016 (4) TMI 1150 - AT - Central Excise

Availment of credit without receipt of goods - Held that - Revenue has established that the material received by M/s.Cethar Vessels Pvt. Ltd. was of greater thickness than the material allegedly supplied by the appellant. It is seen that duty paying invoices on the basis of which the appellant who are a registered dealer have issued the invoices contained the thickness of the plate. The main noticee M/s.Cethar Vessels Pvt. Ltd. have accepted their liabilities and have paid their dues, after the same was adjudicated by the Additional Commissioner. It is seen that the case of appellant is not covered by Section 11A (2) as in this case the dues were paid after the matter was adjudicated and not immediately on issue of information. Section 11A(2) requires payment of duty within 30 days of the issue being raised. In the instant case the payment has been done much later than the issue of show-cause notice and 30 days after adjudication. Since in this case, the provisions of 11A (2) are not attracted the co-noticees cannot get any benefit in terms of the decision of the Tribunal in the case of Raman Gandhi Vs. CCE, Delhi (2015 (3) TMI 1110 - CESTAT NEW DELHI ) & Tikam P Bhojwani Vs. CCE, Ahmedabad (2011 (3) TMI 893 - CESTAT, AHEMDABAD ) cited by them. - Decided against assessee

Summary

Issues:
1. Availment of credit without receipt of goods.
2. Allegations of fraudulent invoices.
3. Benefit of Section 11A(2) of the Central Excise Act.
4. Liability to penalty for passing wrongful credit.

Analysis:

1. The case involved M/s.Cethar Vessels Pvt. Ltd. for availing credit without receiving goods, with additional allegations against M/s.Mahalaxmi Trading Corporation for issuing fraudulent invoices. The demand against M/s.Cethar Vessels Pvt. Ltd. was confirmed, imposing penalties and interest.

2. The appellant argued that M/s.Cethar Vessels Pvt. Ltd. had paid the amount, interest, and penalty within thirty days, claiming entitlement to the benefit of Section 11A(2) of the Central Excise Act. The appellant disputed the allegation that the material received did not match the invoice description, stating that mentioning thickness was unnecessary as per tariff requirements.

3. The Assistant Commissioner argued that the invoices issued by the dealer contained material thickness, and the appellant's failure to mention this facilitated wrongful credit to M/s.Cethar Vessels Pvt. Ltd. The AR contended that the appellant was liable for penalties in such circumstances.

4. The Tribunal found that the material received by M/s.Cethar Vessels Pvt. Ltd. was thicker than that supplied by the appellant. The duty-paying invoices contained material thickness details, and the main party accepted liabilities and paid dues after adjudication. As the appellant paid dues post-adjudication, not within 30 days of the issue being raised, Section 11A(2) did not apply. Citing precedents, the Tribunal dismissed the appeal, stating that co-noticees could not benefit from Section 11A(2) in this case.