2024 (1) TMI 773 - AT - Central Excise

CENVAT Credit - issuance of invoices without supply of goods - Penalty - HELD THAT - The same issue has come up before this Tribunal in the case of M/S UMA IRON STEEL INDUSTRIES LIMITED, M/S CALCUTTA METAL CORPORATION, M/S JEKAY INTERNATIONAL TRACK PRIVATE LIMITED, M/S DAYAL COMMERCIAL COMPANY. M/S CARNATION INDUSTRIES LIMITED, M/S CARNATION INDUSTRIES LIMITED, M/S INDIAN ALLOYS FABRICATORS, M/S HOBB INTERNATIONAL PRIVATE LIMITED, M/S KISHAN BAJAJ @ KRISHAN CHANDRA BAJAJ, M/S MAA SHAKTI IRON WORKS, M/S RAJPUT ROLLING MILLS, M/S J.P. STEEL UDYOG VERSUS COMMISSIONER OF CGST EXCISE, HOWRAH 2023 (10) TMI 1108 - CESTAT KOLKATA , has held that the cenvat credit received by the said companies from the same Ganesh Forging Comapany as eligible. In the present case also the Appellant submitted evidence to the effect that they have paid transportation charges to the carrier who carried the said inputs to their factory and also paid service tax on the freight. Accordingly, by following the ratio of this Tribunal, the Cenvat credit availed by the Appellant based on the invoices issued by M/s Ganesh Forging Company cannot be denied. Thus, the impugned order denying the credit is not sustainable. Penalty - HELD THAT - Since the credit is held to be eligible, the penalty imposed on the Appellants Shri. Shorab Ali, Managing Director and Shri.Nasim Khan, Authorized signatory are also not sustainable. The impugned order set aside - appeal allowed.

Summary

Issues involved:
Three appeals filed against the impugned Order-in-Appeal upholding duty confirmation, penalty imposition, and recovery of Cenvat credit.

Issue 1: Duty Confirmation and Penalty Imposition
The Ld. Commissioner (Appeals) upheld the duty confirmation of Rs.3,57,030/- along with interest and imposed an equal amount of duty as penalty. Additionally, penalties of Rs.3,00,000/- each were imposed on the Managing Director and Authorized signatory of the Appellant company. Cenvat credit of Rs.4,159/- was ordered to be recovered along with interest and a penalty of Rs.2000/- was imposed under Rule 15(3) of the Cenvat Credit rules, 2004. The appeals were filed against this impugned order.

Issue 2: Eligibility of Cenvat Credit
The main issue in the present appeals was whether the Appellant is eligible to avail the Cenvat credit based on the invoices issued by M/s Ganesh Forging Company. The investigation alleged that the supplier issued invoices without actual supply of goods, leading to the Appellant taking Cenvat Credit without actual receipt of goods. The Appellant contended that they received the materials, paid transportation charges, and service tax on the freight, making them entitled to the credit. Reference was made to a Tribunal decision where similar credit was held to be eligible. The Tribunal found that the Appellant provided evidence of payment for transportation and service tax, concluding that the Cenvat credit availed based on the invoices cannot be denied. Consequently, the impugned order denying the credit and imposing penalties was set aside, allowing all three appeals filed by the Appellants.

This summary provides an overview of the issues involved in the legal judgment and details the comprehensive analysis and decision made by the Appellate Tribunal CESTAT KOLKATA regarding duty confirmation, penalty imposition, and the eligibility of Cenvat credit based on the invoices issued by M/s Ganesh Forging Company.