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TMI Blog2010 (6) TMI 465X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd., they are not the first stage dealer but they still issued invoices by posing themselves as first stage dealer. Held that: the penalties have rightly been imposed on the appellant - However, in view of nature of contravention and the fact that the cenvat credit has been allowed by the Commissioner (Appeals) to the end users, the penalties on the appellant are reduced to 25% of cenvat credit demand. - E/1447-1452/2008 - 862-867/2010-SM(BR)(PB) - Dated:- 29-6-2010 - Shri Rakesh Kumar, J. REPRESENTED BY : Shri K.K. Sharma, Advocate, for the Appellant. Shri S.N. Singh, DR, for the Respondent. [Order]. - The facts giving rise to these appeals are, in brief, as under : 1.1 The appellants are registered as first stage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices issued by M/s. Golden Steel Co., M/s. Shiva Associates, M/s. Shiva Industrial Corporation, M/s. Metal Trading Co. and Shri Bihari Ji Steels, who had purchased the goods from the appellants are not the invoices issued by the second stage dealers and hence no cenvat credit could be taken on those invoices. On this basis, the SCNs were issued to the end users - i.e. M/s. Velmoid Plastics (P) Ltd., M/s. Duro Engineering Works, M/s. Khurbros Automotive Industries, M/s. J.S. Industries, M/s. Super Steel Engineers and M/s. Sai Ram Industries for recovery of wrongly taken credit by them and also to the appellants as well as to M/s. Golden Steel Co., M/s. Shiva Associates, M/s. Shiva Industrial Corporation, M/s. Metal Trading Co. and Shri Bihar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Cenvat credit to the end users. The Commissioner (Appeals), however, upheld the penalties imposed on the appellant on the ground that though the appellant had purchased the goods from a dealer M/s. Rameshwar Das Devi Dayal (P) Ltd., they still issued invoices as first stage dealers. It is against this order of the Commissioner (Appeals) that the present appeals have been filed. 3. Heard both sides. 4. Shri K.K. Sharma, Advocate, the learned Counsel representing the appellants, pleaded that the Commissioner (Appeals) has accepted M/s. Golden Steel Co., M/s. Shiva Associates, M/s. Shiva Industrial Corporation, M/s. Metal Trading Co. and Shri Bihari Ji Steels as second stage dealers and allowed the cenvat credit on the basis of invoices ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lants in issuing the invoices as first stage dealers for passing on cenvat credit. In view of this, imposition of penalties equal to cenvat credit demand involved and in some cases more than the cenvat credit demand was not called for. 5. Shri S.N. Singh, learned DR, defending the impugned orders pleaded that the Commissioner (Appeals) in his impugned orders has given a clear finding that since the appellants had neither purchased the goods from the manufacturer M/s. Swastika Pipe Ltd. nor from the their consignment agent - rather they had purchased the goods from M/s. Rameshwar Das Devi Dayal (P) Ltd., who was only an indenting agent and not the consignment agent of the manufacturer, that the appellants are not covered by the definition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 (253) E.L.T. 497 (T)] wherein the appellant M/s. Gautam Steel Traders after purchasing the goods manufactured by M/s. Swastika Pipes Ltd. from M/s. Rameshwar Dass Devi Dayal (P) Ltd. sold the same to M/s. Metal Trading Company, which, in turn, had sold the goods to M/s. SDL Auto (P) Ltd., the Tribunal held that M/s. Gautam Steel Traders cannot be treated as first stage dealers, and that in view of this, the penalties have been rightly imposed on the appellant. 6. I have carefully considered the submissions from both sides and perused the records. 7. As per definition of First stage dealer given in Rule 2(ii) of the Cenvat Credit Rules, 2004, first stage dealer means a dealer, who purchases the goods directly from - (i) The manuf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the manufacturer/importer or from the depot of the said manufacturer/importer or from the premises of the consignment agent of the said manufacturer/importer or from any other premises from where the goods are sold by or on behalf of the said manufacturer/importer under a cover of invoice and thus receiving the goods directly from the manufacturer/importer, is not enough. In these cases, it is not the case of the appellants that M/s. Rameshwar Das Devi Dayal Pvt. Ltd. were consignment agents of the manufacturers. In view of this, I hold that the Commissioner (Appeals) has rightly treated the appellants as other than the first stage dealers. The appellants have cited the judgment of the Tribunal in the case of Balaji Iron Steel Traders ..... X X X X Extracts X X X X X X X X Extracts X X X X
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