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TMI Blog2015 (11) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty, etc. are in order. The penalty under Section 11AC is correctly imposed as this is a case of fraudulent availment of Cenvat credit, interest under section 11AB would be payable. As far as the appellant No.2 & 3 are concerned; they were the directors at the relevant time. Their conduct during investigation as also the statements made by Shri Naval Kishore Vasu, General Manager and Shri KK Agarwal, authorised signatory leaves no doubt that the fraudulent availment of Cenvat credit was at their instance alone. Shri Naval Kishore Vasu was authorised to give statement by appellant No.2 & 3 and therefore, in a way the appellant No.2 & 3 have admitted their role in the fraudulent availment of Cenvat credit, we find that penalty imposed are not on the higher side. - Decided against assesse. - APPEAL No.E/85623, 85624, 85632 & 85663/13 - - - Dated:- 30-6-2015 - Mr. P.K. Jain, Member (Technical) And Mr. S.S. Garg, Member (Judicial) For the Petitioner : Shri.Ashok Kumar Singh, Advocate For the Respondent : Shri.V.K.Agarwal, Addl. Comm. (AR) ORDER Per: P. K. Jain 1. Brief facts of the case are that the appellants have availed Cenvat credit amounting to ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as payments made to the purported suppliers but in fact were issued as self cheques and amounts were withdrawn in cash. 3. Statements of Shri Naval Kishore Vasu, General Manager of the appellants firm were recorded on 31/08/2007. During the recording of statement, he was shown a letter written to the jurisdictional Assistant Commissioner of Surya Sponge Iron Ltd. and the reply received. After going through these documents he submitted that copies of the invoices retrieved from their factory are totally different from the copies of the original invoices. Differences in the invoices recovered from the factory and that received from the jurisdictional authorities were elaborated by Shri Naval Kishore Vasu in his statement. 3.1 Later on a number of summons were issued to the Directors appellants No.2, 3 4 of the appellant firm. However, they themselves did not appear for tendering their statement. Later on, Shri Naval Kishore Vasu was authorised to appear on behalf of Shri Vinod Goel, the Director of the company and in his statement dated 11/03/2008 he stated that the said illegal activities of taking fraudulent Cenvat credit without purchasing/receiving the inputs in the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... BP Singh from M/s.Godawari Power Ispat Ltd., appeared for cross examination. However, on the said date the Advocate for the appellants did not turn up. Other persons, whose statements were relied upon did not turn up in spite of the notices on three different occasions. 3.6 Keeping in view the replies submitted by the appellants, the Commissioner adjudicated the case wherein he confirmed the demand of ₹ 4,49,99,766/- imposed equal penalty under Rule 13 of the Cenvat Credit Rules, 2002/Rule 15 of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944, confirmed interest under Section 11AB and also imposed a penalty of ₹ 50 lakhs each on Shri Vibnod Goel, Shri Darshan Churiwala and also a penalty of ₹ 30 lakhs on Shri Gourav Goel. Aggrieved by the said order, the appellants are before us. 4. The case was heard on 04/06/2015 and also on 30/06/2015. The only contention raised by the learned Counsel for the appellant was that they had requested for cross examination of the persons, whose statements have been relied upon by the Revenue and except one person, other persons were not produced by the Revenue. Since whole case is based u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hore Vasu. Shri KK Agarwal, authorised signatory stucked to his statement and thus confirmed the fictitious documentation and role of appellant No.2, 3 4. It was further submitted that other persons, Shri BP Singh came and presented himself for cross examination. Advocate of the appellants suddenly absented. Even in respect of other persons, the Commissioner had issued notices more than once for cross examination, but they did not appear. Thus, even the conditions stipulated under Section 9D (1) (a) of the Central Excise Act, 1944 are satisfied and hence their statements can be relied upon by the adjudicating authority. 5.3 The learned AR further submitted that the fundamental condition for availment of Cenvat credit is receipt of goods, duty payment on the goods to the Government and the corresponding invoices. In the present case the appellant has neither during investigation nor during adjudication nor before this Tribunal has produced even a single documents evidencing that the sponge iron from the suppliers as indicated in the invoice was received by them. This could have been easily done by them by producing the transport documents and the persons, who had transported th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e taken unless all the particulars as prescribed under the Central Excise Rules, 2002 or the Service Tax Rules, 1994 are contained in the said document. In case any particulars are missing, Cenvat credit may be taken only with the prior approval of the jurisdictional Asst./Dy. Commissioner of Central Excise, if he is satisfied that the goods or service covered by the document have been received and accounted for in the books of account of the receiver. Sub-rule (4) of the said rule further stipulates that the Cenvat credit in respect of input or capital goods purchased from a first stage dealer or second stage dealer shall be allowed only if such first stage dealer or second stage dealer, as the case may be, has maintained records indicating the fact that the input or capital goods was supplied from the stock on which duty was paid by the producer of such input or capital goods and only an amount of such duty on pro rata basis has been indicated in the invoice issued by him. Sub-rule (5) further stipulates that the burden of proof regarding the admissibility of the Cenvat credit shall lie upon the manufacturer or provider of output service taking such credit. Similar provisions exi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whom the input or capital goods have been procured is recorded and the burden of proof regarding the admissibility of the Cenvat Credit shall lie upon the manufacturer or provider of output service taking such credit . 6.2 The Modvat credit scheme was introduced in 1986 and in the initial phases of the scheme, the manufacturers were required to intimate about the arrival of the raw-materials in the factory to their jurisdictional Central Excise authorities, who in turn were required to verify the inputs received. Further the manufacturers were required to submit copy of the gate passes as evidence of duty payment by supplier of the goods along with the monthly return in order to enable the department to verify the correctness of the Cenvat credit taken. Later on the procedure was simplified and the manufacturers were required to submit intimation and wait for the specified period within which the jurisdictional authorities could physically verify the inputs received. Later on more and more trusts were reposed in the manufacturers/assesses and the requirements of intimation and physical verification was done away with. The invoices being received with monthly return, above certa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r view the contentions of the revenue are correct and the demands of duty, interest and penalty, etc. are in order. 6.5 In addition to the above, we find the conduct of the appellant directors of the appellant company very strange, inasmuch as that number of summonses were issued to them, they did not appear in response to these summonses. They authorised Shri Naval Kishore Vasu, their General Manager to give statements on their behalf, but during the adjudication proceedings they want to cross examine the same person. To our mind this implies cross-examining themselves. Another employee Shri KK Agarwal had appeared for cross examination, he stood by his original statement. Shri BP Singh from Godawari Power Ispat Ltd. appeared for cross examination but the appellants advocate did not turn up. The Commissioner has issued three notices on three different occasions to call all the witnesses but other five witnesses did not respond. Thus, there would have been undue delay. Keeping in view these facts and the provisions of Section 9D (1) (a) (b) , in our view the statements made by various persons can be relied upon. The learned Counsel for the appellant has quoted few judgement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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