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TMI Blog2017 (12) TMI 1375X X X X Extracts X X X X X X X X Extracts X X X X ..... same time, there is also no dispute that DAPL were, in fact, manufacturing and clearing angles and channels after conversion of the MS ingots on payment of duty. When this is so, there has to be some source of supply of raw material. Apart from these unfounded evidences and uncorroborated facts which are the main basis of the SCN, the department has also, to a large extent, relied upon the statements of manufacturers of the appellants - none of these persons whose statements were recorded have been cross examined. The department has not been able to satisfactorily establish the allegations made in the SCN - appeal allowed - decided in favor of appellant. - E/584/2009, E/582/2009 & E/637/2009 - Final Order No.43229-43231/2017 - Dated:- 26-12-2017 - Ms. Sulekha Beevi C.S. Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical) Shri J. Surender Reddy, Advocate For the Appellant Shri S. Govindarajan, AC (AR) For the Respondent ORDER Per Bench All these appeals since emanate out of same impugned order they are taken up together for common disposal. 2. The facts of the case are that M/s.Shanti Alloys Pvt. Ltd. (hereinafter referred to as SAPL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty of ₹ 15 lakhs each on SAPL and BAPL under Rule 13 of CER 2002 / Rule 15 of CCR 2004. Aggrieved, all these three assessees are before this forum. 3. On 12.12.2017,when the matter came up for hearing on behalf of appellant Ld. Advocate Shri J. Surender Reddy made oral and written submission which can be broadly summarized as under : (i) DAPL had availed cenvat credit on the basis of the invoices issued by M/s.SAPL and BSIL containing all the required particulars for passing on the cenvat credit and which is a valid documents for availment of cenvat credit under Rule 9(1) of the Cenvat Credit Rules, 2004. (ii) DAPL had entered into an agreement with SAPL for conversion of MS Ingots into rolled products such as MS Channel, MS Angle etc. in consideration of fixed conversion charges per mt. The said MS Ingots were received from SAPL under cover of valid dealer invoice issued by its depot / branch in Bangalore on payment of appropriate excise duty by SAPL. (iii) On one hand, the appellant had availed cenvat credit on MS Ingots and on the other hand had discharged the excise duty on the value of MS Ingots plus the conversion charges on clearance of fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt company which proves non-receipt of goods by the appellant. (x) The appellant had duly recorded all the transactions in the books of accounts and inventory records. There is n discrepancy being pointed out by the department either in the books of accounts or the stock / inventory records of the appellant. Appellant having reflected the raw material in their cenvat credit account and having shown the utilization of the same, heavy duty is casted on Revenue to establish that such raw material was not the one which was covered by invoice in question and stands procured by assesse from any other source. (xi) CESTAT in the case of Bhuwalka Steel Industries Ltd. VS CC [2010 (261) ELT (564 (Tri-Bang.)] have allowed the cenvat credit availed by BSIL on invoices issued by SAPL. The credit in that case was disallowed on the same ground on which the credit has been denied to the appellant in the instant case. In the case of BSIL also the supplier was SAPL and in the case of DAPL also (appellant) the supplier is SAPL. The ground on which cenvat credit was denied in that case was due to the fact that the appellant had availed cenvat credit on the basis of dealer invoice raised b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tigating officers of Shri Suprakash Dey, Works Manager, BSIL. Whereas the show cause notice has been issued on 16.04.2008; that is after almost three years from the date of visit of the premises of appellant and almost two years after the investigation got over. The appellants place reliance on the following cases in support of their contention :- a. Indian Petrochem. Corpn. Ltd. v. CCE, Vadodata - 2000 (125) E.L.T. 1048 (Tribunal) b. Lovely Food Industries VS CCE [2006 (195) E.L.T. 90 (Tri.-Bang.)] c. JSL Industries Ltd. Vs CCE [1999 (109) E.L.T. 316 (Tribunal)] d. Gammon India Ltd. Vs CCE [2002 (146) E.L.T.173 (Tri.-Mumbai)] Affirmed in 2002 (146) ELT A313 (Supreme Court) Further, there is no allegation of fraud, collusion, suppression of facts or any contravention of provisions of the Act or Rules with an-intent to evade payment of duty on the appellant in the show cause notice. In the absence of such an allegation extended period is not invokable against the appellant. Limitatation for extended period not invokable unless show cause notice puts assessee to notice specifically as to which of the various commissions or omissions stated in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds, channels used MS ingots as the main raw material. They procured raw material mainly from SAPL who is a registered dealer. They availed credit on such invoices as well as availed credit on the MS ingots on the strength of invoices issued by BAPL. The invoices showed the address of SAPL as No.27, 1st Floor, MRR Road, Bangalore and on perusal of the invoices raised by BAPL, it was found that it was a manufacturer s invoice and in the invoice, it was mentioned that materials sent for conversion on account of Shanti Alloys, M.R.R. Lane, Bangalore. When the officers visited the said address of SAPL on 25.05.2005, it was found that the depot was not existing in the said address. The same was confirmed by the Superintendent of Basavangudi Range, Bangalore. Only after initiation of investigations, SAPL informed the department that they are operating from No.480, 1st floor, KHB Colony, 5th Block, Koramangala, Bangalore-560 095; that they had obtained Central Excise Registration Certificate under this address. Thus, it was very clear that SAPL was issuing invoices from a non-existent dealers premises. It also emerged from verification that some of the vehicles which was shown as used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nputs was got done at the factory premises of DAPL and if so, whether any shortage thereof was found vis-`-vis quantity claimed to have been received from SAPL on invoices. 6.3. In any allegation that raw material has not been received and there was only paper transaction of invoices for availing cenvat credit, the absence or for that matter, shortage, of raw material in the factory premises is relevant fact to corroborate and support any such allegation. No shortage of inputs is alleged at the time of visit of officers. At the same time, there is also no dispute that DAPL were, in fact, manufacturing and clearing angles and channels after conversion of the MS ingots on payment of duty. When this is so, there has to be some source of supply of raw material. Consequently, when the department alleges that no raw material was received from SAPL, the department has to indicate what is the alternate source of raw material, obtained by DAPL, in an accounted or unaccounted manner for use in their manufacture. This has certainly not been done. We also do not find any disagreement by the department on the claim made by the appellant that the clearances of MS ingots by SAPL was only done ..... X X X X Extracts X X X X X X X X Extracts X X X X
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