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TMI Blog2014 (3) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... eable as such - In the normal trade parlance, no one will buy these types of products of rolling industry making it economically unviable and thus creating non-justification of such purchase. There is no justification in appellant’s plea that rolling materials have been purchased to improve the quality of their finished product. - balance of convenience clearly indicates paper transactions with intent to avail fraudulent credit. - once credit is Prima facie taken on finished goods in the guise of scrap, fraudulent activity clearly surfaces, Prima facie case is in the favour of Revenue - Stay granted partly. - Appeal No.E/58075, 58330, 58441, 58574-58575, 58681,58834-58838/2013- EX[DB] - Stay Order No. 60148-60158/2013 - Dated:- 17- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... materials under various heads of classification similar to their finished products of prime quality. 1.3 Statements of various suppliers namely:- (i) Sh. Taranjit Singh - Auth. Signatory- M/s. Chirag Trading Company, Ludhiana. (ii) Sh. Satish Kumar-Director -M/s. Sharman Strips Pvt. Ltd., Ludhiana. (iii) Sh. Sanjay Gupta - General Manager M/s. Fortune Metals Ltd., Mandi Gobindgarh. (iv) Sh. Happy Gupta - Prop.- M/s. A.H.Alloys, Ludhiana. (v) Sh. Madan Lal -Accounts Officer - M/s. Kanin India Ltd., Ludhiana. (vi) Sh. Jasbir Singh- Senior Manager - M/s. Tube Products of India, Mohali. (vii) Sh. Inderjeet Singh - Managing Director - M/s. Steelman Rolling Mills Pvt. Ltd., Ludhiana. (viii) Sh. R.S.Aggarwal - Manager - M/s. Adhu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was observed that namely prime quality of finished goods or cut pieces have been claimed to be supplied. Although it was also brought on record that these prime quality cut pieces were fit for rolling purposes., but their purported use in furnace has created fiction for these items as scrap. 1.5 On the other hand, the Department has alleged that supplier are engaged in paper transactions as most of the manufacturers have cleared these goods under the same heading as their prime product and have tried to mislead the Department by added certain addition. Description of the goods like rejected, short length etc. has resulted in fraudulent availment of the Cenvat Credit of Rs.1,44,52,571/-. Commissioner Central Excise in his impugned order he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Accordingly, doubts emerged that whether CR Sheets have been received in the factory for manufacture of Former at all. Sh. Naveen Dhooper, Director of M/s. Sharman Strips Pvt. Ltd., Ludhiana in his statement agreed that this material (CR Sheets) were in fact not used in their furnace unit but had been used for some other purposes and they had reversed the credit taken on these invoices. Otherwise also, CR sheets were not covered under the definition of rule 2A of Cenvat Credit Rules 2004. 3. Purchase of 207.515 MT of Rejected wire from M/s, Kanin India Ltd., Unit-II during the period from Feb. 08 to Oct. 09 also came under scanner. Supplier admitted that material sold was basically rejected raw-material which were not usable as such due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rejected cut pieces), Round Bar S/L Rejected Round Bar Small Pieces, M. S. Round Cuttings and Non-Alloy Steel Round S/L Rejected. There have also been purchases of HR/CR Sheets, Silicon Strips/Scrap, Secondary/defective Small Roll/Rejected Wire etc. for manufacture of MS Ingots/Alloy Ingots. While going through the various statements, it was observed that the suppliers of such material have admitted that they have supplied these items as a scrap. Actually these items were not used / capable of use as scrap for the manufacture or alloy and non-allow steel ingots / castings of Chapter 72 73 of CET Act. However, these scrap were not sold at higher price but these were billed at normal prevailing price of the scrap. It is observed that in som ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... force as all bills on which credit was taken were relating to finished products with their original classification of rolled products. Explanatory note of HSN as referred supra also points indicator that so called scrap of rolled industry product was actually not scrap at all. 8. We do not find any justification in appellant s plea that rolling materials have been purchased to improve the quality of their finished product. 9. The credit availed by the notice 1 on the different items is as under:- Sl. No. Description of good Credit availed 1. Bars / rounds 1,12,85,091/- 2. HR/CR Coil/Sheet 3,19,026/- 3. Rejected transformer 45,177/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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