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TMI Blog2016 (6) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... quiry. Apart from the above, the statement of the transporter Shri Satish Agarwal has been retracted before a Magistrate and Sri Janakiram in cross examination retracted his statement and also deposed that his statement was recorded under duress. The case of the department is built-up mainly on these statements. As the statements have been retracted, there has to be some other evidence to conclude that the goods were not actually received. Whereas, the statutory records, weighment slips, job work challans, production register all stand in favour of the appellants. These documentary evidence do prevail over the retracted confessional statements Though the department alleges that there was cash flow in return for the fraudulent activity, which was unaccounted, there is no evidence in this regard. When the statutory records are proper and appellant has manufactured the final products and cleared them by paying duty, then the burden rests heavily upon the Revenue to establish with cogent evidence that the goods were not actually received in the factory. In the totality of facts and evidence, paced it is find that revenue has miserably failed to establish the allegations raised i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing aggrieved the appellants have preferred these appeals. 5. The crux of the case put forward by department is that the appellants though imported goods vide Bill Entry , diverted the same without bringing the goods into the factory or use in their manufacture. They thus wrongly availed credit on the strength of bill of entry without actually receiving the goods. The findings in the impugned order in E/1242/2011 is reproduced as below for better appreciation of facts and evidence in the present case. Verification of case records reveals that the appellants had irregularly availed cenvat credit of ₹ 7,17,415/- based on the Bill of Entry No.426225 dated 16-05-2005 without actual receipt and consumption of raw material mentioned therein, in contravention of above mentioned Cenvat Credit Rules, 2004 by adopting modus operandi as deposed in the statement dated 02-07-2008 by Sri V.K.Janaki Ram, Authorised Signatory of the appellant company before the Investigating Agency and the same was corroborated by the statement sof Sri Dilip Kothari, Proprietor of M/s Metal Udyog, Secunderabad, Srti Satish Agarwal,partner of M/s Time and Space Haulers,Mumbai, Sri Praveeen Agarwal, P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary to the provisions of Cenvat Credit Rules as discussed in para supra . 6. The very same findings are made in the impugned order regarding appeal No.E/1266/2011 except for the change in amount of credit availed, number and date of bill of entry. Further according to department, Sri V.K.Janaki Ram whose statement is heavily relied by department is the authorized signatory of the appellant, in appeal No.E/1242/2011. He is the Managing Director of appellant in Appeal No.E/1266/2011. 7. Controverting these findings, the contentions put forward by appellant is as under: (i) The appellant filed Bill of Entry at Tuglakabad and cleared the goods in appellant s name. The goods were then transported from Tuglakabad to Hyderabad under proper Lorry Receipts (LR). On reaching Hyderabad, the goods were weighed in a weigh bridge for which weighing slips were issued. Appellant had furnished these documents to the department. The goods received in the factory was entered in statutory and private records maintained by appellant. The goods were then sent for job work for conversion into rods under job work challans. The receipt of processed goods from job worker and their usage in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat appellants purchased the goods from Dinesh International and Vipin Enterprises at New Delhi and goods were diverted at New Delhi itself, the statement of suppliers of the goods was not recorded. No enquiry was made about the alleged diversion or cash flow. (vii) Though it is alleged that the CHA, J.M.Baxi cleared the goods for the importer and that he received the money in cheque and later returned the same as cash, the statement of CHA was not recorded. (viii) The statement of the transporter at Delhi was not taken and also the statement of the Owner/Driver of vehicles in which the appellants contend that the goods were transported was not recorded. (ix) The appellant produced the weighment slips to establish that the goods were received in the factory. Neither did the department conduct any enquiry in this regard nor was it accepted as evidence. (x) Though the appellant submitted that goods received were sent for job work under proper challan no enquiry was conducted in this regard. Further, no evidence is adduced by department to show that appellant substituted the raw materials alleged to be diverted. (xi) That appellants were denied opportunity to cross exam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gued that in the absence of corroborative evidence, credit cannot be denied based on confessional statements. In Commissioner Vs Motabhai Iron Steel Industries 2014-IL-1617-HC-AHM.CX. The Hon ble High Court observed that when the assessee was deprived of the opportunity to cross examine no reliance can be placed on the statement of such witness. Again, the appellants contended that the goods were transported from Delhi to Hyderabad. But the department has failed to conduct any enquiry in this direction. There are no statements taken from drivers of the trucks. The transactions entered in the statutory records of the appellant are supported by proper banking channel. Though the department alleges that there was cash flow in return for the fraudulent activity, which was unaccounted, there is no evidence in this regard. When the statutory records are proper and appellant has manufactured the final products and cleared them by paying duty, then the burden rests heavily upon the Revenue to establish with cogent evidence that the goods were not actually received in the factory. In the totality of facts and evidence, paced before me, I find that revenue has miserably failed to establish ..... X X X X Extracts X X X X X X X X Extracts X X X X
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