2014 (10) TMI 510 - AT - Central Excise

Availment of Cenvat credit - Non receipt of inputs in factory - Held that - No verification has been made with the transporters by Revenue and there is no admission or supporting evidence from transporters to prove that they have not transported the goods; three vehicles shown to have been utilized are incapable to transport the goods but no verification has been made with records maintained for receipt of the goods and nature of the goods; and the records maintained as regards receipt of goods especially with regard to two consignments said to have been received by the appellant within 44 minutes when the distance between the supplier and the appellant is more than 60 Kms also have been verified. In respect of 17 invoices where the appellant admitted the liability, description of the goods in the invoices did not tally with the records maintained by them; in respect of others there is no evidence whatsoever. Therefore, prima facie, we can say that the appellant has made out a case for waiver of balance dues. Accordingly, requirement of pre-deposit of the balance dues is waived and stay against recovery is stayed during pendency of the appeals - Stay granted.

Summary

Issues:
1. Condonation of delay in filing appeals.
2. Availment of Cenvat credit without receiving inputs.
3. Verification of transporters and records for receipt of goods.
4. Requirement of pre-deposit and waiver of balance dues.

Detailed Analysis:
1. The Appellate Tribunal, CESTAT Bangalore, addressed the issue of condonation of a 6-day delay in filing appeals. The Appellant sought condonation, which was allowed after satisfactory explanation for the delay was provided. Consequently, the COD applications were allowed.

2. The case involved the appellant being accused of availing Cenvat credit without receiving inputs in their factory. The department's case was based on several points, including suppliers not having the facility for manufacture, discrepancies in raw materials received, and issues with transportation. The appellant argued that they had produced finished goods, paid substantial amounts during the investigation, and maintained records reflecting receipt of raw materials and production of finished goods. The Tribunal found that the appellant had made a case for waiver of balance dues, considering the discrepancies and lack of concrete evidence against them.

3. The issue of verification of transporters and records for receipt of goods was crucial in determining the validity of the department's claims. The Tribunal noted that no verification had been conducted with the transporters by Revenue, and discrepancies were found in the records maintained. The Tribunal highlighted the lack of supporting evidence from transporters and discrepancies in the description of goods in the invoices compared to the records. Prima facie, it was concluded that the appellant had made a case for the waiver of balance dues, and a stay against recovery was granted during the appeals' pendency.

4. Regarding the requirement of pre-deposit and waiver of balance dues, the Tribunal clarified that the deposit made by the appellant "under protest" was considered as a pre-deposit for the purpose of hearing the appeals. The Tribunal waived the balance dues based on the appellant's submissions and the lack of concrete evidence against them. The decision aimed to provide relief to the appellant during the appeal process.