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TMI Blog2011 (1) TMI 623X X X X Extracts X X X X X X X X Extracts X X X X ..... o as the appellant). However, the driver told that the goods had been loaded from the godown cum depot premises of ESL in Ludhiana on 11-1-99 itself and he was given invoice dated 30-12-98 for this consignment. A statement of Shri Piara Singh was recorded in this regard on the same date. Thereafter, the officers visited the depot of ESL at Ludhiana and made inquiries with Shri J.S. Parmar, Depot Manager also confirmed to have dispatched the intercepted goods and also admitted that they had not issued any invoice on 11-1-99 for the said consignment and that he had covered the same consignment under an earlier invoice dated 30-12-98. Since the goods were not covered under the proper documents, the same were placed under seizure as the same appeared to be liable for confiscation. The officers also checked the stock of ESL at Ludhiana Depot and during stock checking, 60 H.R. Coils weighing 1323.920 M.T. valued at Rs. 1,85,07,786/- were found in excess of the balance as recorded in RG-23D register maintained at the depot and the same were placed under seizure. A show cause notice dated 7-7-99 for confiscation of the goods seized from the truck no. PJV-3271 and the excess goods seized fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found that a transporter, Shri Bhagwan Dass had lifted the HR coils from Railway yard to the premises of ESL's Depot. M/s. Timco Steel Industries, who were the handling agents of ESL, Hazira for their Ludhiana Depot also confirmed having received the goods on the instructions of Shri J.S. Parmar and Shri U.V.S. Verma of the ESL Depot at Ludhiana. When confronted with the above evidence, Shri J.S. Parmar, who had earlier denied having received 77 H.R. Coils from ESL, Hazira, accepted having received the same in the depot, but which had not been entered in their excise records. However, as per the records, the appellants during the above mentioned period, had received 77 H.R. Coils from the factory of ESL at Hazira, Surat under invoices, issued by Hazira factory and on the basis of those invoices, Cenvat credit of Rs. 30,22,774 had been taken. Investigations conducted by the department indicated that the goods had been received from Ludhiana depot of ESL and not from their factory at Hazira, while the invoices covering the goods had been issued by the factory of ESL at Hazira. The Department was, therefore, of the view that the goods had actually been received from Ludhiana Depot o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - was confirmed against the appellant company along with interest at the applicable rate; (b) penalty of Rs. 37,55,264/- was imposed on the appellant company under Rule 57-I(4), and 173Q of the Central Excise Rules, 1944; (c) penalty of Rs. 38 Lakh was imposed on ESL, Ludhiana under Rule 209A of the Central Excise Rules, 1944; (d) penalty of Rs. 5 Lakh was imposed on M/s. Timco Industries, Dhandari Kalan, Ludhiana under Rule 209A of Central Excise Rules, 1944; and (e) penalty of Rs. 10,000/- was imposed on M/s. National Goods Carrier, Lucknow under Rule 209A of the Central Excise Rules, 1944. 1.6 On appeal, the Commissioner (Appeals) of Central Excise, Ludhiana vide Order-in-Appeal No. 686/CCE/dated 30-12-2008 while upholding the denial of Cenvat credit of Rs. 37,55,264/- and confirming its demand, set aside the demand of interest and imposition of penalty on the ground that the entire disputed amount of Cenvat credit had been paid back by the appellants even before the issue of show cause notice and, therefore, in view of the Tribunal's judgment in CCE v. Machino Montell India Limited reported in 2004 (168) E.L.T. 466, the question of imposing penalty and recovery of interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not in dispute. It is also not in dispute that the inputs received are in agreement with the invoices issued by ESL, Hazira and the invoices showed the payment of duty on the goods. Similarly, there is no dispute that the invoices indicate the name of the appellant [M/s. Hero Cycles Limited (C.R. Division), Ludhinana] as the consignee and the final product manufactured out of H.R. Coils were cleared on payment of duty. The dispute is only with reference to the invoices on the basis of which the credit has been availed by the appellant. While the HR Coils had been received from the depot of ESL at Ludhiana, the credit has been taken on the basis of the manufacturer's invoices pertaining to the same goods and hence, the credit taken is in accordance with the law. (c) The goods H.R. Coils received by the appellants are covered by the invoices issued by ESL, Hazira, which are a valid document for availing the Cenvat credit. In view of this, just because the goods dispatched from the factory of ESL were first unloaded at their depot at Ludhiana and from there the same were subsequently transported to the appellant's factory, the credit cannot be denied on the ground t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invoice showing the appellant's name as consignee. There is no dispute that the invoices issued by the manufacturer are valid duty paying documents and the goods received had been utilised for manufacture of the finished products, which had been cleared on payment of duty. In view of this, there is no justification for denying the credit of Rs. 30,22,774/- in respect of 77 HR Coils. (f) The Hon'ble Supreme Court in the case of Union of India v. Marmagoa Steel Ltd. reported in 2008 (229) E.L.T. 481 (S.C.) has held that when the goods imported by M/s. Essar Gujarat Ltd. were transferred directly to the assessee from the port and the bills of entry produced by the assessee indicated that M/s. Essar Gujarat Limited had paid duty at the time of import, the credit cannot be denied. The ratio of this judgment of the Hon'ble Supreme Court is squarely applicable to the facts of this case. In addition to this, Hon'ble Punjab & Haryana High Court in the judgments of CCE, Delhi-III v. Bright Brothers Ltd. reported in 2009 (236) E.L.T. 660 (P&H), CCE, Jalandhar v. J.C.T. Limited reported in 2009 (234) E.L.T. 47 (P&H)) = 2009 (13) S.T.R. 22 (P&H) and CCE, Delhi-III, Gurgaon v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be taken as a ground to allege suppression on the part of the appellants with an intent to evade payment of duty. It does not materially alter the case as against the appellants whether the input manufacturer issues an invoice from his factory or his depot issues the invoice as registered dealer. In either case, the appellants would be entitled to the cenvat credit. (5) When no Cenvat credit is recoverable from the appellant, there is no question of any intention on the part of the appellant to evade payment of duty and imposition of penalty on them. 2.2 Shri V. Choudhary, ld. Departmental Representative in his oral as well as written submissions, submitted as under :- (1) Cenvat credit of Rs. 30,22,774/- in respect of the 77 HR Coils received from the ESL has been denied as the same had been taken on the basis of the invoices issued by ESL Haziara, Surat, whereas the goods were received from ESL's Depots at Ludhiana. Since the goods had been received from Ludhiana depot, the same should have been transported under the cover of invoices issued by the sales depot under Rule 57GG as registered dealer and the cenvat credit could be taken only on the basis of those invoic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame has been reversed by the Punjab & Haryana vide the judgment, reported in 2006 (202) E.L.T. 398 (P & H) = 2006 (4) S.T.R. 177 (P & H). In view of this, the Commissioner (Appeals)'s order setting aside the interest and penalty is not correct. 3. We have carefully considered the submissions from both the sides and perused the records. 4. The first point of dispute in this case is regarding taking of Cenvat credit amounting to Rs. 7,32,490/- on the basis of the original copies of the invoices. The Department's contention is that as per the provisions of Section 57A(3) read with Rule 57G(6), cenvat credit could be taken only on the basis of duplicate copy of the invoice and under Rule 57G(6) the credit could be taken on the basis of original copy only if the duplicate copy is lost in transit and intimation regarding the same has been given to the Asstt. Commissioner and he is satisfied that the inputs had been received in the factory, while in this case, the credit on the basis of original copies of the invoice had been availed without following the procedure prescribed under Rule 57G(6). There is no dispute about the fact that the appellants have not given any reason as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er their invoices to the appellant. But due to some reasons, the goods were first unloaded at the ESL depot at Ludhiana, from where the same were subsequently despatched to the appellant's factory. If the appellant had received the goods directly from Hazira factory at Ludhiana under their invoices, there would have been no dispute about the cenvat credit on the basis of the invoices issued by the Hazira factory of ESL. The department's contention is that since there is evidence on record showing that the goods dispatched by ESL, Hazira to the appellant under their invoices were first been unloaded at their depot and the appellants received the goods only from the depot, the Ludhiana depot of ESL should have issued the invoices in respect of those goods under Rule 57GG as registered dealer and it is only under those invoices that the appellant could taken the Cenvat credit. We do not agree with this view of the department, as when there is no dispute about the fact that the goods, in question, had been dispatched by Hazira factory of ESL under their invoices to the appellant and the invoices were in the name of the appellant and due to some reasons, goods were first unloaded at ESL ..... X X X X Extracts X X X X X X X X Extracts X X X X
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