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TMI Blog2017 (6) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... tatutory records and have also manufactured dutiable goods which have been cleared on payment of duty - it is not the case of revenue that the respondent-assessee received only duty paying document from M/s M.K. Steels whereas they have received the raw material from any other source - credit allowed - appeal dismissed - decided against Revenue. - E/2943 & 2944/2009-EX [SM] - A/70495-70496/2017-SM[BR] - Dated:- 12-5-2017 - Mr. Anil Choudhary, Member (Judicial) Mohammad Altaf, Assistant Commissioner (AR) for Appellant Shri Abhinav Prasad, Advocate, for Respondent ORDER Per: Anil Choudhary The present appeal is filed by the revenue against Order-in-Appeal No.227-228-CE/APPL/KNP/2009 dated 26/08/2009 passed by Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uction of finished goods against these consignments (raw material), and cleared the finished goods after payment of central excise duty to Indian Railways. The appellant has also accounted for these transactions in their trade tax returns and have discharged their trade tax liabilities. Thus on the basis of the records placed before me it may be concluded: (a) The input in question have entered in U.P. as it is certified by another Govt. department (Trade Tax Department). The same was recorded by appellant in their records and used in the manufacture of the final products which was cleared on payment of duty. (b) Payment for the purchase of the input has been made through cheque and by demand draft. It is contention of the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. In my view this mode of transactions is bona-fide on appellant's part, in this circumstances it has been accepted that buyer can take only those steps which are in their control. He is not expected to verify records of supplier to check whether in fact the supplier has paid duty on goods supplied by him. He cannot verify whether their supplier is in fact registered with excise. He has to rely on statements made by supplier and documents supplied by him. The only reasonable steps he can take is to ensure that the supplier seems to be trustworthy, inputs are in fact received and documents prima facie appear to be genuine. Making payment by cheque to seller will prove his bona fide. Further, CBEC, vide circular No.766/82/2003-CX d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s accompanying the goods, has been paid. In the present case, it was urged that the assessee ought to have made an enquiry which would have indicated that Sarla Ispat (P) Ltd., that had allegedly supplied the original raw material was a fictitious entity. Rule 9(3) of the Rules of 2004, provides as follows :- (3) The manufacturer or producer of excisable goods or provider of output service taking Cenvat credit on input or capital goods or input service, or the input service distributor distributing Cenvat credit on input service shall take all reasonable steps to ensure that the input or capital goods or input service in respect of which he has taken the Cenvat credit are goods or services on which the appropriate duty of excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are goods on which the appropriate duty of excise, as indicated in the documents accompanying the goods, has been paid. Admittedly, in the present case, the assessee was a bona fide purchaser of the goods for a price which included the duty element and payment was made by cheque. The assessee had received the inputs which were entered in the statutory records maintained by the assessee. The goods were demonstrated to have travelled to the premises of the assessee under the cover of Form 31 issued by the Trade Tax Department, and the ledger account as well as the statutory records establish the receipt of the goods. In such a situation, it would be impractical to require the assessee to go behind the records maintained by the first stage de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of Rule 9(3) of the Rules of 2004, the assessee has taken reasonable steps to ensure that the inputs in respect of which he has taken Cenvat credit were goods on which appropriate duty of excise was paid. Once it is demonstrated that reasonable steps had been taken, which is a question of fact in each case, it would be contrary to the Rules to cast an impossible or impractical burden on the assessee. Accordingly, learned counsel for respondent prays for dismissing the appeal of revenue. 5. Heard the learned A.R. for revenue have relied on the grounds of appeal, wherein it have been urged that there is no dispute regarding issue of fake Cenvat invoices by M/s M.K. Steels, who issued these invoices without receipt of duty paid ingo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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