9911796707
TMI Blog2011 (3) TMI 1130X X X X Extracts X X X X X X X X Extracts X X X X ..... ortation thereof, nor it is a case of mere issuances of invoices without goods having accompanied and in these circumstances, we do not found any case having been made out for taking action in terms of Rule 209A. The findings arrived at by the Commissioner (Appeals) that the goods were liable for confiscation is clearly not born out from the record and are not sustainable. - E/1078 of 2005 & 1312 of 2005 - 319-320/2011-EX(PB) - Dated:- 16-3-2011 - Shri Justice R.M.S. Khandeparkar, Shri Rakesh Kumar, JJ. Appellants : Rep. by Shri L.P. Asthana, Advocate Respondent: Rep. by Shri Nitin Anand, DR Per Shri Justice R.M.S. Khandeparkar: Heard the learned Advocate for the assessee and DR for the Revenue. 2. Both these appeals arise from the order dated 31.12.2004 passed by the Commissioner (Appeals), Ludhiana. By the impugned order the lower appellate authority has partially modified the order passed by the adjudicating authority by reducing the penalty to Rs. 2 lakh from the penalty of Rs. 38 lakh which was imposed by the adjudicating authority. The Additional Commissioner, Ludhiana by his order dated 12.08.2004 had disallowed the modvat credit to the tune of Rs. 37 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in 1991 (55) ELT 454 (SC), U.K. Enterprises vs. Commissioner of C. Ex. Goa reported in 2002 (140) ELT 419 (Tri. Del.) and drawing our attention to Rule 57GG of the Central Excise Rules, 1944 submitted that it was incumbent upon the assessees to make necessary entry in the RG23D register in relation to the goods received in their depot as also to issue necessary invoices while clearing the goods from depot and in the absence thereof the goods were liable to be confiscated. 7. He further submitted that it was to the knowledge of the assessees that they required to maintain necessary record in such circumstances and to issue the invoices while clearing such goods from depot and this is clearly revealed from the statements of in-charge of depot recorded in the course of the investigation. 8. The proceedings for contravention of the provisions comprised under Rule 57GG and non entering and failure to make entry in RG23D register were the basis for initiating the action against the assessees for which the show cause notice dated 01.12.2003 came to be issued and the same was sought to be contested by the assessees by filing their reply dated 16.08.2004. Therein, it was specifical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another registered person say 'Y' (or from any other person registered under Rule 174) on the strength of the invoice under Rule 57G issued by registered person 'X'. This registered person 'Y' then further issues invoices under Rule 57G and so on. (a) Whenever a registered person receives a consignment under Rule 52A invoice or 57G invoice and in respect of the same he proposes to issue either one or more modvatable invoices, he shall keep complete account of each such consignment and all transactions relating thereto in RG23D register. (b) In respect of any consignment part of which is sold under a modvatable invoice and the other part under the cover of non-modvatable invoice, then the details of sales under non-modvatable invoices have also to be entered in the prescribed register RG 23D. The non modvatable invoices are not required to be issued in the prescribed proforma. (c) A registered person need not enter into RG 23D register details of those consignments received under Rule 52A invoice or 57G invoice for which he does not propose to issue modvatable invoices . 11. The said clause relates to two situations relating to passing of the Modvat credit by registered per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e authorities can verify the necessary records which are audited and submitted to the authorities and find out whether the material was used in its own undertaking or not. We do not think we can accede to this contention. Having failed to file the necessary declaration he cannot now turn around and ask the authorities to make a verification of some records. The verification at the time when the raw material was still there is entirely different from a verification at a belated stage after it has ceased to be there. May be that the raw material was used in the industrial undertaking as claimed by the petitioner Company or it may not be. In any event the failure to file the necessary declaration has necessarily prevented the authorities to have a proper verification . (Emphasis supplied) 14. The Apex Court further referring to its earlier decision in the matter of Kedarnath Jute Manufacturing Co. vs. Commercial Tax Officer, Calcutta and Ors. reported in (1965) 3 SCR 626 reiterated the decision therein while quoting a paragraph from the said decision which reads as under:- There is an understandable reason for the stringency of the provisions. The object of Section 5 (2)(a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he matter in hand. In the case in hand, the assessees have not claimed any benefit out of the transaction in question. 17. It is also a matter of record that the goods at Hazira being sold to M/s Hero Cycles were in fact, received by M/s Hero Cycles Limited and it was merely in transit they were stored in the depot of the assessees. In other words, there is neither a case of any clandestine removal of the goods in the course of transportation thereof, nor it is a case of mere issuances of invoices without goods having accompanied and in these circumstances, we do not found any case having been made out for taking action in terms of Rule 209A. The findings arrived at by the Commissioner (Appeals) that the goods were liable for confiscation is clearly not born out from the record and are not sustainable. 18. For the reasons stated above, therefore, the appeals succeed, the impugned order is hereby quashed and set aside with consequential relief. Considering the fact that the order taking action against the assessees itself is not sustainable, question of imposing penalty does not arise. For the same reason, question of enhancing the penalty does not arise. The appeal filed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
