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TMI Blog2013 (7) TMI 216X X X X Extracts X X X X X X X X Extracts X X X X ..... cided against the Assessee. On the one hand Department has demanded CENVAT credit on the ground that inputs were not received whereas on the other hand they have demanded duty on clandestine removal and both cannot co-exist - Held that:- The case relating to clandestine removal is based on non-transportation and non-receipt of Aluminium scrap and the clandestine removal charge is based on specific quantity of raw materials accounted for and feasible production therefrom. Both can co-exist – Decided against the Assessee. Cleared Aluminium Alloy ingots without payment of duty - Held that:- Appellant cleared Aluminium Alloy ingots without payment of duty and the demand of duty to more than Rs.94 lakhs can be justified on various grounds - Generation of Aluminium ash and iron waste has been shown to be around 33% of the total production whereas it is quite well known that in Aluminium industry other than melting loss and evaporation of 2 to 3%, there cannot be any other loss - Also gathered evidences in the form of statements of transporters to show that no ash or iron waste transported and also made efforts to contact the buyers. None of them can be traced out, etc. – Decid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1 lakh, Shri V.K. Jha, Spector-in-charge of AMA - Rs.50,000/-, Shir Surjeet Singh Chawla, Partner of M/s. Chawla Roadlines - Rs.5 lakhs, M/s. Kishore Co. - Rs.1 lakh, M/s. Steel Metals, Kolkata - Rs.1 lakh, M/s. Consumer Products, Kolkata - Rs.1 lakh, Shri Ramesh Chaudhary, Proprietor of M/s. Royal Transport of India - Rs.1 lakh, M/s. Metal Link Alloys, Bhimpore - Rs.2 lakhs. In addition penalties have been imposed under Rules 13/15 of CENVAT Credit Rules on the functionaries of AMA also. All the persons concerned are in appeal. 2. Issues No.1: Wrong availment of CENVAT credit without receipt of raw materials and their use by AMA-II: 2.1. According to the Revenue, appellants did not receive Aluminium Ingots weighing 663.062 MTs, Aluminium scrap totally weighing 417.580 MTs and 26.548 MTs of Copper scrap thereby wrong credit of more than Rs.1.36 crores was availed. The conclusion that appellants (AMA-II) did not receive these inputs but took the credit based on the following evidences ---- based on the test reports and copper content of the finished Aluminium alloy ingots manufactured by AMA-II during the period from 18/12/2004 to 11/03/2005, it was found that there was a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ind that this submission was never made before the Commissioner or the investigating officers. In any case, we find that the case relating to clandestine removal is based on non-transportation and non-receipt of Aluminium scrap and the clandestine removal charge is based on specific quantity of raw materials accounted for and feasible production therefrom. Both can co-exist. The second submission was that cross-examination was not allowed by the Commissioner and, therefore, the defence was handicapped. We find that the appellant's own authorized signatory had given admission statements as regards shortages and feasible production etc. Moreover, the kind of evidences discussed above would clearly show that transportation from Kolkata to Silvassa as claimed by the appellants did not lake place at all. When one of the vehicles is not even registered at the time and when other vehicles were found to be incapable of transportation or owners admitting that they have not transported which is further supported by the fact that that the vehicles did not pass through the Sales Tax Check Posts and no stamps were found on documents, the case is made on the basis of documents and records and, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r iron waste was transported and also made efforts to contact the buyers. None of them can be traced out. Further, one of the buyers, Shri Radheshyam Yadav, Authorised signatory of M/s. Ganpati Alloys, Silvassa categorically submitted that they have not received any iron steel scrap and fairly admitted that they have received CENVAT able invoices for 74.296 MTs. Investigators have also found that appellants had procured Aluminium scrap through M/s. Saini Road Carriers which had not been reflected in the books of accounts. The same Saini Road Carriers had also admitted that they had never transported Aluminium ash or steel scrap. The clearances of Aluminium ash by the appellant without accounting for in the books has been worked out on the basis of the records of M/s. Saini Road Carrier. Investigators have found that AMA-II had procured 689 MTs of local scrap from traders by utilizing the services of M/s. Saini Road Carriers for which payments were made in cash. Corroboration of these transactions have been made by comparing with the entries made in the books of accounts maintained by M/s. Saini Road Carriers without any corresponding entry in the books of AMA-II. It has been brou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty demand, interest and penalties are imposable. 5. Liability of penalty in respect of M/s. Kishore Co., M/s. Consumer Products and M/s. Steel and Metals. 5.1. In respect of these three, the finding is that they supplied only invoices in respect of Aluminium ingots to facilitate availment of CENVAT credit by AMA-II. We have already discussed availment of CENVAT credit and denial of the same. We have considered evidences in respect of transportation from Kolkata to Silvassa, the evidences in the form of statements of transporters for not having transported the goods, non-existence/incapacity of vehicles, report of Transport Commissioner, statements of owners of vehicles which clearly show that goods were not transported. The submission on behalf of the appellants was that Department has not found out evidences in respect of all consignments and transporters were not provided for cross-examination. The suppliers' defence is that there are not aware whether the goods went and they had handed over the goods to the transporters. But there is no answer to the evidence in the form of non-existence of vehicles/incapable of vehicles and the statements of transporters and the owners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransportation took place. There is enough evidence, therefore, to show that there were no transportation of Aluminium ingots. 8. Liability of M/s. Royal Transport of India for penalty: 8.1. Shri Ramesh Chaudhary, Proprietor of M/s. Royal Transport of India has admitted that they have issued LRs without transporting goods and he has not retracted the statements. Therefore, he is also liable to penalty. 9. Liability of Shri Narsingh Swamy, Authorised Signatory, AMA-II, Shri Samir Agarwal, Partner of AMA-II, Shri Vipul Vinod Agarwal, Partner of AMA-II, Shri Ramnivas Swamy, Authorised Signatory of AMA-II, Shri Shailendra Authorised Signatory of AMA-II and Shri V.K. Jha, Spectro-in-charge of AMA. 9.1. Shri Narsingh Swamy is the authorized signatory of AMA-II and was looking after the entire Central Excise matters under instructions of Shri Samir Agarwal and he was actively involved in the manipulation and fabrication of Central Excise records. He has also admitted the clearance of goods in the name of AMA-I manufactured by AMA-II and this has not been retracted. Further without connivance of Shri Narsingh Swamy, this could not have taken place. However, we find that there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the liability to penalty on the firm also ultimately would have to be paid by the partners only even though partners are separate from the firm. 9.5. Accordingly, the penalties imposed under Rule 26 by the Commissioner on the functionaries/transporter/supplier are modified as follows:- Sl. No. Name of the person/unit Penalty imposed by Commissioner Penalty reduced to 1. Shri Samir Agarwal Rs. 12 lakhs Rs. 5 lakhs. 2. Shri Vipul Agarwal Rs. 12 lakhs Rs. 5 lakhs. 3. Shri Narsingh Swamy Rs. 2 lakhs Rs. 10,000/- 4. Shri Ramniwas Swamy Rs. 2 lakhs Rs. 10,000/- 5. Shri Shailendra Rs. 1 lakh Rs. 5000/- 6. Shri V. K. Jha Rs. 50,000/- NIL 7. Shri Surjeet Singh Chawla Rs. 5 lakhs Rs. 1 lakh 8. M/s. Kishore Co. Rs. 1 lakh Rs. 20,000/- 9. M/s. Steel Metals Rs. 1 lakh Rs. 20,000/- 10. M/s. Consumer Products Rs. 1 lakh Rs. 20,000/- 11. Shri Ramesh Chaudhar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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