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TMI Blog2014 (4) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... mposed upon him has been correctly upheld by the first appellate authority - Decided partly in favour of assessee. - Appeal No. : E/1461/2009 & E/1462/2009 - ORDER No. A/10477-10478/2014 - Dated:- 1-4-2014 - Mr. M.V. Ravindran and Mr. H.K. Thakur, JJ. For the Appellant : Shri M.N. Saiyed, Consultant For the Respondent : Shri S.K. Mall, AR JUDGEMENT Per : Mr. H.K. Thakur; Appeal No. E/1461/2009-DB has been filed by main appellant M/s. Shree Labdhi Prints, Surat and Appeal No. E/1462/2009 has been filed by Shri Biren R. Vakharia, Partner of the main appellant. Both these appeals have been filed against OIA No. RKA/542-543/SRT-I/2009 dated 30.07.2009 passed by Commissioner (Appeals) upholding the OIO No. 154/ADJ/JC-VKS/OA/08-09 dated 30.12.2008. Under the OIO dated 30.12.2008 CENVAT credit of Rs. 10,53,855/- was disallowed to the main appellant along with charging of interest and an equivalent amount of penalty was also imposed upon the main appellant. A penalty of Rs. 1,05,385/- was also imposed upon Shri Biren H. Vekharia, Partner of the main appellant by the Adjudicating authority. 2. Brief facts of the case are that main appellant was availing CEN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Consultant) appearing on behalf of the appellants argued that CENVAT credit has been taken by the main appellant on the basis of grey fabrics received from the merchant manufacturers and that entire CENVAT credit taken was deposited before the issue of show cause notice. It was his case that once the entire demand was paid before the issue of show cause notice then there is no point in imposing penalties upon the appellants. It was also his case that benefit of 25% reduced penalty under Section 11AC of the Central Excise Act, 1944 was not extended to them by the lower authorities. On penalty imposed upon the partner Shri Biren H. Vakharia, it was argued that no penalty is imposable on the partner once the firm has been penalised. 4. Shri K. Sivakumar (AR) appearing on behalf of the Revenue argued that investigation conducted in this case clearly revealed that appellants were a party to the fraud and well aware of the facts that there is only movement of invoices without the present of inputs on which credit was taken. He made the bench go through Para 9 and 12 of the judgment passed by Gujarat High Court in the case of Prayagraj Dyeing and Printing Mills Pvt. Limited vs. UOI [20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rer cannot be found at the present, such fact cannot make the invoices fake or fraudulent documents in the eye of law. These are actual invoices issued by the manufacturer who is duly registered under the Central Excise Act and, therefore, those cannot be said to be forged documents. In our opinion, merely because today, the original manufacturer, who is registered with the Revenue, is not traceable, it does not mean that he did not exist at the relevant point of time. If today, a manufacturer is not available for various reasons that does not mean that at the relevant point of time, such manufacturer who was registered with the Central Excise, did not exist. In our opinion, once receipt of goods is not disputed by a person taking credit and necessary invoices are issued, he is entitled to take credit provided however that he took reasonable steps to ensure that the inputs or the capital goods in respect of which he had taken CENVAT credit are the goods on which appropriate duty of excise as indicated in the documents accompanying the goods, has been paid. 10. .. 11. .. 12. The next question is whether demand of reversal is barred by the period of limitation. In our opini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner of Customs v. Jupiter Exports - 2007 (213) E.L.T. 641 (Bom.). In that case, a notice to show cause was issued by the Commissioner of Customs on an allegation of the misuse of the DEEC Scheme by adopting fraudulent means to obtain a higher entitlement in respect of duty free import. The Commissioner of Customs confirmed the duty demanded and imposed penalties on the main partners, who had actively participated in the business of the firm. In appeal, the Tribunal held that the firm was liable to pay duty only to the extent of goods actually imported by it quantified in the amount of Rs. 1.38 lakhs. As the bulk of the imports were made by bona fide transferees of the licenses obtained and sold by the Petitioner, the Tribunal held that the Petitioner could not be considered to be the importer for the recovery of the duty. An appeal was filed by the Revenue while a Petition was filed by the firm seeking enforcement of the order of the Tribunal. This Court, in the course of its judgment held that no fault can be found with the view taken by the Tribunal since it is now well settled that when partnership is penalized, separate penalties cannot be imposed on the partners. Evidentl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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