9911796707
TMI Blog2007 (8) TMI 756X X X X Extracts X X X X X X X X Extracts X X X X ..... nd was availing modvat credit facility. The respondent was procuring input scrap under chapter heading 7204 from various dealers registered under Rule 174 of the Central Excise Rules 1944, under the cover of invoices issued by such dealers. The respondent have procured goods from three registered dealers who had given particulars of the manufacturer of the goods. The preventive staff however found that the same manufacturer were raising modvatable invoices to different manufacturers/dealers without undertaking any manufacturing activities and without actual transaction of the goods. According to the Revenue, as per the Notification No. 466/86 dated 22.12.86, a person availing of credit of duty on goods received by him shall be deemed to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of the respondent that, the manufacturer had been submitting necessary returns to the department and the dealers from whom the scraps purchased were also regular assessee of the department. Therefore, necessary precautions were taken by the respondent in selecting the dealers. In the further reply, it was stated that, reasonable steps were taken to ensure that the goods supplied were genuine, and that they had procured the material in question from the registered dealers asking them to provide copy of their registration certificate, representative copies of invoice raised by customer and these were annexed with the reply at Annexure A thereto. Reliance was placed on the decisions of the Tribunal in the case of Shree Krishna Rolling ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent at the rate of ₹ 7425/- PMT as against their purchase price of ₹ 8000- 9000 PMT, which indicated that, there was only paper transaction because such a transaction cannot be commercially viable and there was no reason why the dealers should have sold the goods to the respondent at a price lower than the price paid by them. It was contended that it was incumbent upon the respondent to have taken reasonable steps to ensure that the inputs in respect of which cenvat credit was taken were the goods on which appropriate duty of excise was paid. It was further submitted that, the fact that the payments were made through cheques, was not decisive, because, the modus-operandi of making payments by cheque and then recovering the amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ake invoices was a serious violation of the rules. 5. Both the authorities below have come to a finding that the goods had been received in the factory of the respondent and were consumed therein for the manufacture of final products. It has also come on record that, the respondent had availed credit on the dealers invoices which were modvatable invoices as recorded in the order of the adjudicating authority, which is confirmed by the Commissioner (Appeals). The receipt of goods, their duty paid nature, and consumption thereof in the factory of production is not under dispute. It was also held that, adequate steps were taken by the respondent to satisfy themselves inasmuch as they had procured the material from registered dealers and al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocuments issued by the registered dealers. Reliance was placed on the earlier decision of the Tribunal in the case of CCE, Chandigarh vs. Malerkotla Steels Alloys (P) Ltd., reported in 2003 (156) ELT 932. The Division bench of this Tribunal in the case of Commissioner of Central Excise, Jaipur vs. Ashok Leyland Ltd. Reported in 2001 (127) ELT 804 (Tri.Del.) held, that so long as there is no discrepancy in the documents on the strength of which the credit was availed, it cannot be denied to the assessee. 7. The learned authorized representative (DR) for the department has pointed out that, the Revenue has filed an appeal against the order dated 30.11.2004, passed in the appeal of the Revenue being Excise Appeal No. 2262 of 2004 in which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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