2016 (7) TMI 1173 - AT - Central Excise

Demand of rebate erroneously sanctioned - Held that - The rebate was duly sanctioned. However, the Department subsequently found out that the rebate claim was submitted on the basis of forged documents. Detailed investigation revealed that no export has taken place in respect of six of the shipping bills, and in other cases, exporters names were different. It is also observed that the learned Counsel appearing for the Appellants in the Adjudication proceedings concluded that there was nothing to submit on merit of the case. He only argued the matter before the Adjudicating authority on the grounds of time bar and legal maintainability of the Show Cause Notice. We find that the rebate has been claimed by fraud. As fraud vitiates everything and Show Cause Notice issued within extended period of five years is clearly sustainable. - Decided against assessee.

Summary

Issues:
Appeal against order confirming demand of rebate erroneously sanctioned based on forged documents.

Analysis:

1. Background of the Case:
The appeals were filed by M/s Golden Impex and another party, challenging the impugned order of the Commissioner, C.Ex. & C, Surat, which confirmed the demand of rebate that was erroneously sanctioned. The Appellants had claimed rebate of ?53,71,950.00 in respect of twelve shipping bills, which were later found to be based on forged documents.

2. Non-Appearance of Appellants:
During the proceedings, no one appeared for the Appellants despite multiple listing dates in the past. The notices sent to the Appellants came back as "not known." The learned Authorized Representative for the Revenue requested the appeals to be disposed of due to their age since being filed in 2008.

3. Investigation Findings:
Detailed investigation revealed that no export had taken place in the case of six shipping bills, and in other cases, the exporters' names were different. The Adjudicating authority concluded that the rebate claim was based on forged documents, as evidenced by discrepancies in the shipping bills and statements from various parties involved in the export process.

4. Legal Arguments:
The learned Counsel for the Appellants in the Adjudication proceedings did not provide any substantive arguments on the merit of the case. Instead, the focus was on procedural aspects like time bar and legal maintainability of the Show Cause Notice. However, the Tribunal found that the rebate claim was fraudulent, and as per legal precedent, fraud vitiates everything.

5. Judgment and Dismissal:
The Tribunal upheld the impugned order confirming the demand of rebate and dismissed both appeals. The decision was based on the established fraud in the rebate claim and the legal sustainability of the Show Cause Notice issued within the extended period of five years.

In conclusion, the Tribunal found the rebate claim to be fraudulent based on forged documents, leading to the dismissal of the appeals filed by M/s Golden Impex and another party. The decision highlighted the legal principle that fraud vitiates everything and upheld the impugned order confirming the demand of rebate erroneously sanctioned.