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TMI Blog2013 (1) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... were clearing/diverting their final product to other persons. It is also seen that all the payments were made to the dealers by cheque and there is no allegation much less any proof of flow back of the money from dealers to the appellant. Revenue has also not made any enquiries from the transporters as regards the transportation of the goods in question. As such the denial of Cenvat credit on the sole statement of manufacturer of the inputs, without taking into consideration the statement of the first stage dealer as also the statement of the manufacturing unit is not justified. It is further seen that manufacturing unit has entered all the inputs in their records which stands shown to have been used in the manufacture of their final pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ling the benefit of Cenvat credit of duty paid on the inputs. The said inputs were being received by them from two registered dealers, i.e., M/s Arvind Enterprises and M/s Avon Steels (India) under the cover of Cenvatable invoices being issued by the said two dealers. The said two dealers received the inputs from M/s Haryana Steel Alloys Ltd. (hereinafter referred to as HSAL). 3. Investigations were conducted at the end of HSAL by the officers of DGCEI and during the course of investigation, it transpired that HSAL were issuing the invoices of carbon steel billets, alloys and MS billets to various manufacturers without actually supplying the goods. Statement of Shri Ramesh Rawat, Executive Director of HSAL was recorded wherein he admi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... product to M/s Honda Motorcycle Scooters India P.Ltd and M/s India Yamaha Motors P.Ltd. They have procured the raw material from two dealers under the cover of invoices. On being questioned, he categorically deposed that they have received the material from the said two dealers and the suggestion that no material was received, is actually incorrect. However, he agreed to deposit the Cenvat credit so availed by them. 6. On the above basis, proceedings were initiated against the appellant for confirmation of demand by denying the Cenvat credit on the basis of invoices issued by M/s Arvind Enterprises and M/s Avon Steels (India). Notice also proposed imposition of penalties on the said two dealers. 7. The show cause notice so issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ises and M/s Avon Steels. In his statement Shri Arvind Tiwari, authorised signatory of said two dealers have clearly deposed that they were receiving the goods from HSAL along with the invoices. It is not the Revenue s case that HSAL was not manufacturing the raw material or were clearing/diverting their final product to other persons. Further the statement of Shri Tiwari stands corroborated by the statement of Shri K.K.Sharma of the manufacturing unit, M/s J.L.Autoparts. It is also seen that all the payments were made to the dealers by cheque and there is no allegation much less any proof of flow back of the money from dealers to the appellant. Revenue has also not made any enquiries from the transporters as regards the transportation of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s entire case is based upon the sole statement Shri Rawat of HSAL and there is no inculpatory statements of either the first stage dealer or the recipient of the inputs and there is no evidence available on record supporting the Revenue s stand, I find no reasons to deny the credit to M/s J.L.Autoparts. Accordingly, confirmation of demand against them along with penalty imposed is set aside. 10. As regards, penalties imposed upon the two dealers, I find that in as much as it stands held that the Revenue s has no evidence on record to support the allegation of non-receipt of raw material, I find no reasons to uphold the said penalties, the same are accordingly set aside. 11. In a nutshell, all the three appeals are allowed with cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
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