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TMI Blog2018 (5) TMI 818X X X X Extracts X X X X X X X X Extracts X X X X ..... same from the open market on cash basis, is not sustainable for the reason that the appellant has to maintain higher standard of quality to make major supplies either for export or to the companies which are operating in atomic energy, power, defence, oil refining etc. In the instant case, no physical verification of stock was done. No shortage of physical stock was identified. Regarding the allegation that payment was made through banking channel and was received back in cash is not sustainable for the reason that no cash was seized from the appellants premises. Department has made out a case of irregular availment of cenvat credit mainly based on the statement of Shri Amit Gupta and transporters, but no cross examination of the witnesses was provided to the appellants. One of the witnesses has retracted his earlier statement. Surprisingly, in the instant case, no inquiry was made from the customers of the appellant company. Appeal allowed - decided in favor of appellant. - Excise Appeal Nos. 51356, 51357, 51377, 51378, 51638, 51639 & 51830 of 2017 and 50031 & 50231 of 2018 - Final Order No. 51800 -51808/2018 - Dated:- 11-5-2018 - Hon ble Mr. Justice (Dr.) Satish Cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l from the dealer companies operated by Shri Amit Gupta without accompanying the goods. It is also the case of the department that fictitious transportation charges have been shown for transportation of the goods. The LRs were in the letter heads of defunct transporters namely, M/s. Leo Trans Logistic, M/s. Sheetal Logistic etc. showing vehicles numbers of LPG tankers, LCB machine, Auto rickshaw etc. Further, the owners, whose vehicle numbers were used to show fictitious transportation by the dealer companies of Shri Amit Gupta, in their respective statements had categorically denied to have transported any consignment of the said dealer companies. It is further alleged that Shri Amit Gupta used to procure unaccounted non-duty paid zinc and copper scrap from the market and supply the same without bills to numerous manufacturers to whom he had provided bills of duty paid zinc scrap, copper rods/ copper scrap. By adopting the aforesaid modus operandi, Shri Amit Gupta had facilitated the issue of cenvatable invoices to numerous manufacturers / dealers without accompanying the goods and passed on the cenvat credit of the duty. 6. In the above scenario, department has made out a ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so submits that the statements were recorded from various persons including Shri Amit Gupta by the department. It was case of the appellant that no opportunity of cross -examination was provided, so it is the violation of natural justice. As no direct corroborative evidence against the appellant proving their involvement in passing of cenvat credit, the appellant on 23.12.2016 has made a request for cross examination of Shri Amit Gupta as per section 9D of the Central Excise Act, 1944. But the request was rejected, which is violation of principles of natural justice. For the purpose, he relied upon the ratio of following cases :- 1. Andaman Timber Industries vs. CCE [2015 (324) ELT 641 (SC)]; 2. Jindal Drugs P Ltd. vs. UOI [2016 (340) ELT 67 (P H)] 14. Regarding the transportation, he submits that as per the agreements, the supply of inputs was on FOR basis. The appellant has nothing to do with how it was transported to the premises of the appellant. The department has made the entire case on the basis of statement of Shri Amit Gupta, transporters and truck owners without any corroborating evidence. 15. Learned Counsel also submits that appellant has availed the cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Ltd. vs. Union of India 2016 (340) ELT 67 (P H)]; 2. Manek Chemicals Pvt Ltd. vs. Union of India [2016 (334) ELT 302 (Guj)]; 3. Goyal Tobacco Co. Pvt. Ltd. vs. CCE ST, Jaipur I [2017 (348) ELT 720 (Tri-Del)]. 17. He submits that the findings of the respondent are contrary to the provisions of 9D of the Central Excise Act, 1944. He also submits that copy of the document at serial No. 178 annexure of the panchnama dated 6.4.2012 has not been supplied to the appellant. Lastly, he made a request that the impugned order may be set aside. 18. On behalf of M/s. Maruti Metal Industries, Shri Sarju Mehta, learned CA on the strength of written submissions, challenged the impugned order on the basis of principles of natural justice. He submits that the allegation is of actual diversion of goods covered by invoices in the domestic open market and flow back of the funds. The demand of duty is not sustainable merely on the basis of submissions made by the transporter of the goods as per the ratio laid down by M/s. Aarya Fibers Pvt. Ltd. others vs. CCE, Ahmadabad II [2014-TIOL-15-CETAT-Ahmedabad]. Argument of the learned counsel is that in the present case, there is no evid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He reiterated that Shri Amit Gupta had procured bogus GRs of his transport company M/s. Leo Trans and Logistics and misused the same. 23. Search was conducted on one of the business premises of M/s. Multi Metals on 4.2.2016 and it was found with name of plate of M/s. Maruti Metal Industries However, it was found to be the residential accommodation of labourer. On being asked they submitted that there was an office of the firm which had been vacated since August, 2015. On perusal of the documents submitted by M/s. Multimetals, it was observed that they have shown the transportation of the goods from M/s. UAPL to M/s. Multimetals Ltd., Kota under the bility of Haryana Delhi Roadlines. But the said transportation company has not joined the investigation, therefore, no statement was recorded. 24. According to the representative of the Department, the appellant has availed the cenvat credit of more than ₹ 5 crores, on the strength of invoices which were not genuine and under which no material was supplied during the period under consideration. Therefore, the appellants have contravened the provisions of Rule 3(4)(9) of the Cenvat credit Rules, 2004. Lastly he justified the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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