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TMI Blog2018 (10) TMI 888X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to M/s Nectar to avail inadmissible cenvat credit. Consequently, demand on account of cenvat credit was confirmed against M/s Nectar along with interest and penalty on both the appellants were imposed. 3. As all the appeals are inter-connected, therefore, all are disposed by a common order. 4. The facts of the case are that an investigation was started at the end of the office of Commissioner of Central Excise, Merrut-II against various units located in their jurisdiction who were purchasing Menthol Solution and De-mentholised Oil from Jammu & Kashmir based units. The Meerut Commissionerate searched the premises of various commission agents and buyers as well as sellers of Menthol Solution & DMO. The officers found that commission agents are neither maintaining proper record of sale of raw material nor purchased the raw material. The commission agents had issued Kissan Kharid Patra to various farmers whereas the investigation conducted at the end of farmers indicates that the farmers are non existence. On the basis of investigation at the end of commission agents and farmers, the Merrut Commissionerate concluded that J&K based units are not purchasing raw material, so there is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat during the course of investigation, itself the appellants were allowed to continue their manufacturing activity, shows that the appellant (M/s Narbada) was manufacturer during the impugned period. Otherwise, Revenue could not have allowed to continue the movements of trucks carrying raw materials as well finished goods during the impugned period. He further submits that the appellant submitted the copy of GRs, Form 21, Form VAT-58, Toll receipts issued at Lakhanpur, copy of agreement between appellant and its supplier issued dated 07.05.2010 issued by the office of Deputy Commissioner Excise, Toll Post, Lakhanpur alongwith computerized list of consignments having (Truck No., quantity, date) imported by the appellant during the period which itself shows that the appellant had manufactured the goods during the impugned period. Moreover, the Central Excise Hq. Preventive Staff, Jammu visited their factory premises of appellant on 30.09.2007 and found certain shortage of 2072.200 kg. of CMO which was received short as per private records about 6000 MT and a show cause notice dated 26.09.2008 was issued by the Assistant Commissioner, Central Excise, Division, Jammu itself shows that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esting of its composition percentile. M/s Nectar exported the goods under ARE-2 and claimed rebate as per input-output ratio fixed by the competent authority vide letter dated 18.08.2009. The adjudicating authority has ignored the following facts. (a) The certificate from Commercial Tax Officer, Jammu dated. 28.04.2006. (b) The certificate from General Manger, District Industries Centre, Jammu dated 27.06.2006. (c) Permission for running the factory into three shifts throughout the year from Inspector of Factories and Boilers, Jammu dated 13.02.2008. (d) Permission for installation of additional machinery for enhancing its capacity/ manufacturing additional product inter-alia on the condition that unit will operate on DG sets and not asked for additional sanction of power vide letter dated 21.10.2008 of Under Secretary to Government of J&K, Department of Industries and Commerce. (e) Annual financial statement in form ER-4 and Annual Installed capacity production in for ER-7 for the period 2007-2008 to 2009-2010. (f) The periodic returns submitted to inspector of Factories. (g) Annual returns relating to employee i.e. ESI & EPF return submitted to the State Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Nector has correctly availed the cenvat credit on the invoices issued by M/s Narbada, therefore the impugned proceedings are not sustainable against the appellants and prayed that the impugned orders are to be set aside. 9. On the other hand, the ld. AR reported the findings of the impugned order. 10. Heard the parties and considered the submission. 11. We find that in this case the sole allegation against the appellant is based on the investigation conducted by Commissioner of Central Excise, Merrut, and as per the investigation, it is alleged that farmers from whom the inputs were purchased were non-existence. Therefore, commission agents never supplied inputs to the appellant and the appellant did not manufacture the goods. Consequently, they have not sold the goods and it was alleged that the appellant has not manufactured the goods at all. 12. We further take note of the fact that, the investigation was not conducted at the end of the appellants and whole case has been based on the investigation conducted at Commissioner Central Excise, Merrut-II. Without investigation, it cannot be held that the appellants were not manufacturer during the impugned period. Moreover, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Ltd. (Supra), wherein this Tribunal observed as under: " 6. We find that in this case the sole allegation against the appellant is based on the investigation made by Commissioner of Central Excise, Merrut, and as per the investigation, it is alleged that farmers from whom the inputs were purchased were nonexistence. Therefore, commission agents never supplied inputs to the appellant and the appellant did not manufacture the goods. Consequently, they have not sold the goods and it was alleged that the appellant has not manufactured the goods at all. 7. We take a note of the fact that the check post movement of trucks which were carrying inputs as well as finished goods were found entered. We further take note of the fact that the appellant has produced the evidence of the entry of all the transport vehicles i.e. trucks which have entered in the state of Punjab and have left the state of Punjab, as the same has been certified by the Punjab Sales Tax Department having entries of entry and exit all the vehicles, therefore, it cannot be said that the raw material/finished goods have never entered or left in the state of Jammu & Kashmir, therefore, the allegation on the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been clearly mentioned that during the periodical checks by the departmental officers, the appellant found manufacturing the goods. Moreover, no discrepancy was found and on toll barriers it was found that the vehicles carried inputs/finished goods found entered. Moreover, the District Centre also certified the said fact. 10.We further take note of the fact that the various other departments namely Pollution Control Department, District Industries Department, Electrical Department have visited the factory of the appellant and found functioning. All these facts have not been disputed by the Revenue. As there is no corroborative evidence to show that the appellant were not manufacturing the goods, therefore, the allegation alleged in the show cause notice is not sustainable. 11.We further take note of the fact that on the basis of the same investigation conducted by the Commissioner of Central Excise, Merrut, the case was booked against the various parties namely M/s Arora Aromatic & Others Vide Final Order No. 71939- 71959/2017 dated 01.11.2017, this Tribunal observed as under: " 10. Having considered the rival contentions and on perusal of the facts on record, we find that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cers of Central Excise Department and sample of the same were also drawn and forwarded for Chemical Examination. Such evidence was also not accepted by the Original Authority, Therefore, it appears that the Original Authority was pre-determined to adjudicate the matter in the manner in which he has decided the issue and he was not just and fair and did not discharge his duty as an independent adjudicator. We, therefore, set aside both the impugned Ordersin- Original dated 29/01/2010 & 29/03/2011 and allow all the appeals filed by appellant. The appellant shall be entitled for consequential relief. All the demand and penalties imposed are also set aside. All the Miscellaneous/Stay Applications stand disposed, as infructuous." 12.In view of the above observations, we hold that without bringing any concrete evidence against the appellant on record, the proceedings against the appellant are not sustainable, therefore, the show cause notice issued to the appellant is only on the basis of the assumption and presumption and investigation conducted by the Commissioner of Central Excise, Merrut, but without conducting any investigation at the end of the appellant, therefore, on the basis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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