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TMI Blog2020 (1) TMI 543X X X X Extracts X X X X X X X X Extracts X X X X ..... been taken alongwith monthly RT-12 reports. The duty paying documents has also been defaced by the departmental officers while assessing RT-12 return of the appellant unit. In such a circumstance there is no scope of invocation of extended period of limitation, which has been done in this case. The show cause notice has been issued on 02.05.2000 for the period 01.04.1995 to 28.01.1996 - The demand is therefore time bared and not sustainable at all. Retraction of statements - The department is alleging that there is no technical feasibility, infrastructural facilities available with the appellant for use of such input material also taking into the consideration of economic validity of use of such goods - HELD THAT:- . This type of investigation is purely on the basis of imagination and without any legal basis. It is up to the manufacturer to use the goods as input or raw material in the process of manufacture and the department cannot force them to use a particular kind of input / raw material for the manufacture of finished product considering their economic viability, technical feasibility and infrastructural requirement. The department has also accepted the payment of duty on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aying document fraudulently prepared and supplied by a number of registered dealers without actually supplying the corresponding input materials mentioned in the said duty paying documents and utilized the said credit availed on an irregular manner towards payment of Central Excise duty on removal of their final product and therefore evaded payment of Central Excise Duty equivalent to the amount of credit irregularly taken to the extent of ₹ 78,91,213/-. 4. The case was investigated by the Directorate General of Antievasion and during investigation Shri Kamal Kumar Choudhary, was arrested on 10.02.1996 and released on bail on 11.07.1996. The enquiry were also made with a number of registered dealers of Iron and Steel Product and that revealed that these registered dealers used to procure the duty paying documents only which were primarily being sold by companies like SAIL and TISCO. The goods sold by the manufacturers were being diverted to some other sectors by the registered dealers, which were being sold in cash without accounting thereof. The registered dealers used to take credit of these materials in their RG23D Account and passed on such credit to ministeel pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant had been using bazaar scrap as apparent from the statement of Shri Haradhan Dutta, Excise Assistant of appellant unit, that the company has only procured modevatable invoices from the dealer and took credit without receipt of the input material. 9. The technical feasibility, economic viability for use of such inputs material by the appellant was investigated by DGAE (CE) and it was found that the use of such material in production of MS Ingots by using induction furnace of small capacity is not viable. There was neither technical feasibility nor infrastructure facility available to the appellant for the use of material for which cenvatable invoices were procured. It was also alleged in the investigation that there could not have been economic viability of using such material by the appellant. 10. The show cause notice dated 02.05.2000 was therefore issued to both the appellants which culminated into the impugned order after the remand direction of this Tribunal. 11. Learned Advocate on behalf of the appellant submits as under: (i) That the appellant has submitted their reply to the Adjudicating Authority, both at the stage of original ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntended that the Modvat credit has been availed on the basis of receipts of the input material and payment of central excise duty to the registered dealers. Accordingly, no case is made out against the appellant and the impugned order is not sustainable. 16. Learned Departmental Representative, however, supports the impugned order on the basis of findings contained therein. 17. We have gone through the facts of the case and perused the appeal record. It is apparent from the impugned order that the Learned Adjudicating Authority, in respect of specific direction from this Tribunal, failed to adhere to the remand direction regarding consideration of submission made by the appellant and also the legal provisions. We find that this Tribunal in case of M/s. Vindhya Steel, who happened to be one of the supplier of the input material, has set aside the order. An appeal against that order was also sustained by Hon ble High Court of Kolkata. In the circumstances, we find that no charge against the appellant would sustain and the impugned order is bad in law. 18. We also find that the appellant had been submitting the document such as RG23A part (1) and RG23 part ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order: 4 . This view has been affirmed by the Customs, Excise and Service Tax Appellate Tribunal, New Delhi (in short the Tribunal ) in its judgment. The Tribunal has found that the revenue has not disputed that the supplier from whom the assessee received the raw materials [MK Steels (P) Ltd.] has raised dealers invoices giving all the particulars required to be furnished in law. Moreover, it was also not disputed that the assessee had received the inputs and entered them in its records and these inputs were used in the manufacture of final products, which were cleared on payment of duty. The goods travelled from the dealer to the assessee under the cover of Form 31 issued by the Uttar Pradesh Trade Tax Department. The ledger account and RG 23A records prove the receipt of the goods. Further, the payments were made by cheque. The Tribunal was of the view that in terms of the provisions of Rule 7(4) of the Rules of 2002 and Rule 9(5) of the Rules of 2004, a manufacturer is required to check the particulars as mentioned in the invoice issued by the first stage dealer and he should be familiar with him. The Tribunal has also held that it would be impractical for an ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise concerned. In other words, the Explanation to Rule 9(3) provides a deeming definition as to when a manufacturer or a purchaser of excisable goods would be deemed to have taken reasonable steps. However, even in a situation where Explanation to Rule 9(3) is not attracted, it would be open to an assessee to establish independently within the meaning of the substantive part of Rule 9(3) that he had in fact taken reasonable steps. Whether an assessee has in fact taken reasonable steps, is a question of fact. 7 . In the present case, both the Commissioner (Appeals) and the Tribunal have given cogent reasons to indicate that the assessee had taken reasonable steps to ensure that the inputs in respect of which he has taken the Cenvat credit 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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