2011 (5) TMI 138 - AT - Central Excise

Waiver of pre-deposit - MODVAT Credit - Irregular availment of MODVAT Credit on the basis of fake and fictitious invoices issued by non-existent and bogus manufacturing units - Held that modify the stay order, set aside the present impugned order and remand the matter to original adjudicating authority for decision in the light of observations made in above referred judgment of M/s Bhagwati Silk Mills and M/s Roop Dyg. & Ptg. Mills - Hence, appeals get disposed off.

Summary

Issues: Irregular availment of MODVAT Credit based on fake invoices, Non-compliance leading to dismissal of appeal

In this judgment by the Appellate Tribunal CESTAT, Ahmedabad, the issue at hand pertains to the irregular availment of MODVAT Credit by the appellant based on fake and fictitious invoices issued by non-existent and bogus manufacturing units. The Tribunal notes that similar issues have been decided in the cases of other appellants, such as M/s Bhagwati Silk Mills and Roop Dyg. & Ptg. Mills Pvt. Ltd. The Tribunal refers to specific orders in these cases where decisions were made regarding the stay order and remanding matters to the original adjudicating authority for a fresh decision. Following the precedent set by these cases, the Tribunal in this judgment modifies the stay order, sets aside the impugned order, and remands the matter to the original adjudicating authority for a decision in line with the observations made in the judgments of M/s Bhagwati Silk Mills and M/s Roop Dyg. & Ptg. Mills. Consequently, the ROA applications and appeals are disposed of accordingly.

The appellant in this case was directed to deposit an amount of Rs.18 lakhs within a specified time frame, which was later extended due to partial payment made by the appellant. However, as the appellant failed to deposit the entire amount and only paid Rs.12.5 lakhs, their appeal was dismissed for non-compliance. The Tribunal, after rejecting a request for adjournment, proceeded to decide the ROA application. The Tribunal considered the non-compliance issue alongside the main issue of irregular availment of MODVAT Credit based on fake invoices, ultimately leading to the decision to modify the stay order and remand the matter for fresh adjudication. The judgment highlights the importance of compliance with directives and the consequences of non-compliance in legal proceedings.

The Tribunal's decision in this case underscores the significance of adhering to legal requirements and directives, particularly in matters concerning taxation and credit availment. By referencing past judgments and following established precedents, the Tribunal ensures consistency and fairness in its decisions. The judgment serves as a reminder of the consequences of non-compliance with orders and the need for proper adherence to legal procedures in resolving disputes related to tax credits and invoices. The Tribunal's approach in modifying the stay order and remanding the matter for fresh adjudication reflects a commitment to upholding legal principles and ensuring a thorough examination of the issues at hand before reaching a final decision.