2013 (12) TMI 703 - AT - Central Excise

Cenvat credit availed on bogus invoices Held that - Owners of the vehicle in respect of the invoices have given categorical statements that no goods were transported in these vehicles from MMTC to Kiran Metals Industries - In view of the statement of transporter recorded under Section 14 of the Central Excise Act, conclusion drawn by both lower authorities that no goods were sent to M/s Kiran Metals are sustainable and accordingly penalty imposed in respect of these invoices is upheld. As regards the invoice No. 27 and 29 - Shri Umang Batra duly authorised by owners of vehicle HR 38 BG 4071 and HR 38A 2562 in his statement refers to invoices issued by M/s International Metal Corporation and denies any movement of goods from M/s International Metal Corporation and does not speak anything about MMTC - the invoices No. 27 and 29 MMTC have shown the origin of goods as self importer - Revenue is not able to prove any case against MMTC in respect of these two invoices - Penalty in respect of the two invoices quashed. VSA has submitted registration papers in respect of vehicle No. HR 46A 6737 and since vehicle No. HR 46A 6737 is registered vehicle and department has not recorded any statement of the owner of the vehicle HR 46A 6737 the benefit of doubt goes in favour of the appellant VSA - in the invoice No. 173 vehicle No. HR 46A 6737 is typed and not handwritten - Contention of the appellant is that letters A and S are next to each other on key board and by mistake S has been typed instead of A has considerable force - Penalty imposed on VSA set aside Decided partly in favour of Assessee.

Summary

Issues:
1. Confirmation of penalties on M/s Mohit Metal Trading Co. (MMTC) and Vardman Sales Agency (VSA) by the Commissioner (Appeals).
2. Availment of Cenvat credit on fake invoices by M/s Kiran Metals.
3. Imposition of penalties on MMTC and VSA by the original authority.
4. Challenge of the Order-in-Original by MMTC and VSA before the Commissioner (Appeals).
5. Rejection of the appeal by the Commissioner (Appeals) leading to the filing of appeals by MMTC and VSA.
6. Disputed Cenvat credit in respect of specific invoices by MMTC.
7. Statements of transporters regarding the transportation of goods mentioned in the invoices.
8. Differentiation in treatment of various invoices by the Tribunal.
9. Investigation and registration details of vehicles mentioned in the invoices.
10. Typing error in the vehicle number on the invoice by VSA.

Analysis:
1. The judgment involves the confirmation of penalties on MMTC and VSA by the Commissioner (Appeals) regarding the availed Cenvat credit based on fake invoices by M/s Kiran Metals. The original authority imposed penalties on MMTC and VSA, leading to their challenge before the Commissioner (Appeals), who rejected their appeal, prompting the filing of appeals by MMTC and VSA against the Order-in-Appeal.

2. The Tribunal scrutinized the disputed Cenvat credit in specific invoices by MMTC, focusing on the statements of transporters regarding the transportation of goods mentioned in the invoices. For certain invoices, the Tribunal upheld the penalties due to discrepancies in the transportation details provided by the transporter, while for other invoices, the penalties were quashed as the Revenue failed to substantiate the case against MMTC.

3. The differentiation in treatment of various invoices by the Tribunal was evident in the analysis of invoices dated 26.6.2006 for MMTC. The Tribunal upheld penalties for some invoices where the transporter's statement contradicted the transportation details, while penalties were set aside for other invoices due to lack of evidence against MMTC.

4. Regarding VSA, the Tribunal considered the investigation and registration details of the vehicle mentioned in the invoice, emphasizing a typing error in the vehicle number. VSA provided registration papers for the correct vehicle, and the Tribunal, giving the benefit of doubt to VSA, set aside the penalty imposed.

5. Ultimately, the Tribunal allowed the appeal filed by VSA and partially allowed the appeal by MMTC, specifically in relation to certain invoices dated 26.6.2006. The appeals were disposed of based on the Tribunal's findings and analysis of the evidence presented by the parties involved.