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TMI Blog2018 (11) TMI 961X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived by the appellants. The appellants have also given explanation to the missing freight documents by contending that in some cases the raw material was received on FOR basis and the freight payments were made by the dealers, whereas in some cases the freight may be paid by the director himself from his own pocket. The onus to establish the allegation is upon the Revenue and is required to be discharged by production of positive and tangible evidences. The missing quality control reports may lead to some doubt requiring further verification and investigation, which the Revenue has indeed done - The result of the investigations conducted by the Revenue does not advance their case inasmuch as all the deponents have repeatedly contended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Angles etc. from various dealers, in respect of which the appellants were undertaking inspection of the same and was maintaining inspection records. Verification of the inspection reports maintained by the appellants led the Revenue to believe that the said reports were not available in respect of each and every consignment and thus leading to the fact that such raw materials were not received by the appellants. 3. In view of the above, further investigations were undertaken by the officers and statements of various persons were recorded. In his statement Shri Piyush Jain, Senior Quality Control Engineer deposed that he inspects the raw materials and Quality Control Department maintains inspection reports of all inspections conducte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were a part of their stock. Some of the dealers also stated that the supply were made on FOR basis and were inclusive of freight. 5. On the basis of the above the appellants were issued a show cause notice dated 02/06/2009 alleging that the raw material in question were not received by the appellants and they have availed the inadmissible Cenvat credit to the tune of ₹ 2,03,32,135/- during the period 2004-05 to 2006-07, without actually receiving the inputs. The notice accordingly proposed to deny the Cenvat credit and to impose penalty upon the appellants as also on their director Shri Ranjan Adlakha. 6. The appellants contested the said show cause notice on various grounds including the limitation. They also produced their In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quality control reports. As per the Revenue the appellants were testing the raw material before being used for the manufacture of their final product. The appellants have a Quality Control Department and maintain record of such testing done by them, in the form of inspection reports. As such the Adjudicating Authority has concluded that such inspection reports are material documents to reflect upon the fact as to whether the appellants have received the raw materials or not. Another document of which the Adjudicating Authority has relied upon is the freight payment register, which has missing links for payment of freight. 10. Undisputedly the statements of the Quality Control Engineer, appellants director as also of various dealers rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. Admittedly the final product cannot be manufactured in vacuum and require the raw materials. It is not the Revenue s case that such raw materials were obtained by the appellants from some other alternative sources, neither is it their case that the consumption of raw materials has been shown on higher side. We really fail to understand that if the raw materials were not received by the appellants, as alleged by the Revenue, how could their final product was manufactured, which stands reflected by them in their statutory records. 13. Further, we note that admittedly the various dealers have shown the sale of the raw materials to the appellants. As per the Revenue such raw materials sold by the dealers were not received by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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