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TMI Blog2023 (3) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... n COMMISSIONER OF SERVICE TAX VERSUS JAPAN AIRLINES INTERNATIONAL CO. LTD. [ 2015 (7) TMI 824 - DELHI HIGH COURT ]. The issue raised therein was identical and the Court concluded that the decision rendered by the Committee of Commissioner is an administrative function and, therefore, a meeting or a consultation is not mandatory so long as each member of the Committee has the requisite material placed before him. It was further observed that the Tribunal while acting as an appellate authority has no jurisdiction to strike down a decision taken by the Committee of Commissioners on the administrative side and the only requirement is to ensure that there is a decision of the Committee of Commissioners to institute an appeal - The objection taken by the respondent in this regard is unsustainable and needs to be rejected. The relied upon documents in the show cause notice are mainly the statements of the manufacturers and dealers including the Director and General Manager of the assessee company which were recorded during the course of investigation - during the adjudication proceedings the assessee requested for cross examination of the persons who made these statements, however, the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial Area, Bokaro; (ii) M/s. A.S. Infratel P. Ltd., Chiragora, Samsan Road, Hirapur, Dhanbad; (iii) M/s. Shree Ram Engg. & Castings, Mango, Jamshedpur; and (iv) M/s. Ganesh Udyog Dhanbad were conducted. 3. Statements of (i) Sh. Sudarshan Singh, Prop. of M/s. Aaditya Enterprises, Bokaro Industrial Area, Bokaro and (ii) Sh. Dharmvir Kumar, Director of M/s. A.S. Infratel P. Ltd. Chiragora, Samsan Road, Hirapur, Dhanbad were also recorded under Section 14 of the Central Excise Act, 1944. 4. During the investigation, DGCEI also undertook searches of six (06) first stage dealers, namely; (i) M/s. Chakradhari Metal Co. Jamshedpur; (ii) M/s. Bajrang Steel Coal & Coke Traders, Jamshedpur; (iii) M/s. L.S Construction, Jamshedpur, (iv) Jai Mata Di Enterprises, Jamshedpur, (v) M/s. Hariom Steels Jamshedpur and (vi) M/s. Shiv Metalicks Jamshedpur. 5. Statements of Sh. Nitish Pandey, Proprietor of M/s. Bajrang Steel Coal & Coke Traders, Jamshedpur and partner of M/s. Chakradhari Metal Co. Jamshedpur as well as Shri Ajay Kumar Singh, Godown Owner of M/s. L.S. Construction, Jamshedpur were also recorded by the DGCEI. 6. Searches of declared registered factory premises of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng been issued by the four (04) non-existent manufacturers as mentioned above and /or seven (07) existing manufacturers namely: (i) M/s. Tata Steel Ltd. Jamshedpur, (ii) M/s. Yazdani Steel & Power Ltd. Kaling Nagar, Growth Centre, Mantira, Jajpur, Odisha; (iii) M/s. Scanin Steel & Power Ltd. Raigarh, Chhattisgarh; (iv) M/s. Maa Shakambhari Sponge P. Ltd. Rourkela, Odisha, (v) M/s. Jai Balajee Jyoti Steels Ltd. Sundegarh, Orissa; (vi) M/s. M.S.P Sponge Iron Ltd. Village Haldiguana, Post- Gobardhanpura, District-Keojhar; Orissa; (vii) M/s Crackers India (Alloy) Limited. Deojhar, District- Keojhar; Orissa. 11. Besides above, investigation was also conducted by the office of the Commissioner, Central Excise and Service Tax Commissionerate, Dhanbad, which revealed that the following units were non-existent at their registered addresses: (i) M/s. High Tides Infra Project Pvt. Ltd. G.T. Road Dhanbad having Central Excise registration No. AACCH9778BEM001, (ii) M/s. Supreme Multi Trade Pvt. Ltd., Plot No. 2, Mahto Campus, Kandra Industrial Area, G.T.Road, Dhanbad having Central Excise registration No. AAPCS3603REM001, (iii) M/s. Visa Steel Industries, Plot No. 115 D, Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... economic condition they could not do so and reversed the amount of Rs. 2,03,000/- only. Similarly the statement of Shri Arun Kumar, General Manager of the assessee company was also recorded on 17.03.2016. After going through the statements of the dealers, he admitted that the CENVAT credit was not admissible on the invoices issued to them and agreed that they are liable to reverse the amount towards CENVAT credit but since their company was lying closed they were not in a position to deposit the same and promised to pay the same later. 14. That from searches conducted on the registered premises of the various companies referred above, it was evident that no such manufacturers were found to be existing on their registered premises and the so called first stage dealers were also not in existence at the relevant time. In other words the said entities existed only on papers and no actual transaction had taken place either through the dealer or the manufacturer. The adjudicating authority observed that the assessee company procured raw-material / inputs from local market of Jaipur, Seekar, Urrisa, Bihar, Jharkhand and also through import to establish that they had manufactured the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he invoices issued to them. The Commissioner (A) have arrived at contradictory findings particularly with reference to para 7.2 whereby he held that the invoices were issued fraudulently, but the same are not bogus or fake and therefore the CENVAT credit taken thereon is admissible. According to the revenue, the Commissioner (Appeals) has not considered the facts in proper prospective and have allowed the credit on the basis of fake invoices issued by various dealers. Revenue also relied on a recent decision of the Tribunal in Commissioner of Central Excise vs. Prem Jain Ispat Udyog Pvt Ltd. vide Final Order No. 50135 of 2022 dted 15.02.2022 where the Adjudicating Authority had concluded that the firms were bogus and were not engaged in manufacturing or trading activity and were only issuing fake invoices to pass on the benefit of CENVAT credit to the respondent who was engaged in manufacturing of MS ingots. In fact, some of the manufacturers/ dealers in the said case are common in the present case, i.e. M/s Aditya Enterprieses, M/s Chakradhari Metal Co., Jamshedpur, M/s L S Contruction, Jamshedpur and M/s Tirpuati Associates, Jaipur. 18. We have heard both the parties at length a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Manager was given ample opportunity to examine the evidences corroborated by the statements recorded by the DGCEI and it is only after perusing the statements placed before them that they gave their testimony and further admitted the facts of wrongly availing the CENVAT credit. In fact they reversed the CENVAT credit of Rs 2,03,000/- and also assured to pay the remaining amount towards the CENVAT credit. The adjudicating authority, therefore concluded that principles of natural justice have been satisfied. 21. During the course of hearing, the main grievance raised on behalf of the respondent was that the case of revenue is based on the statements of third parties and the adjudicating authority has not granted any opportunity to cross examine the witnesses who deposed against him and this amounts to violation of the principles of natural justice. In support thereof, they have relied on several judgements of various forums. Reliance has also been placed on the provisions of section 9D of the Central Excise Act. Before we proceed further, it is necessary to consider the provisions of section 9D of the Act which reads as under: "Section 9D. Relevancy of statements under certain ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. CCEX, ST Udaipur(T Del) CCEx, Lucknow Vs. Premier Alloys Ltd. [2019(366)ELT 659 (HC All)], (ii) Jindal Drugs Pvt Ltd. Vs Union of India [2016(340)ELT 67(P&H)], (iii) Hi-Tech Abrasives Ltd. Vs CCE, Raipur (Chattisgarh HC) (iv) CCEx, Meerut Vs Parmarth Iron Pvt. Ltd. [2010 (260) ELT 514]. 22. We now consider the decision of High Court of Gujarat in CCEx, Ahmedabad. Vs Gujarat Cypromet Ltd. reported in [2017(345) ELT 520(Guj)] where the revenue had challenged the order of the Tribunal remanding the matter back to the adjudicating authority as no opportunity of cross examination was granted. The Court was pleased to observe: Once the adjudicating authority confirmed the duty and penalty, the issue reached the Tribunal. The question that the Tribunal considered for itself at the stage of requirement of pre-deposit was whether the assessees were entitled to cross-examination of the various important witnesses relied upon by the Revenue. There was a difference of opinion between two members forming the Bench. The learned Member (Technical) opined that the respondent should be asked to deposit certain sums by way of pre-deposit to enable them to pursue their appeals on meri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ex and Lakshman Exports the Court was please to remand the matter back to the Tribunal for a fresh consideration in the light of the observations and directions made therein. 24. In Unirose Textile Processors Pvt. Ltd. Vs CCEx, Pune [2006(201)ELT 265], where the West Zonal Bench of the Tribunal was hearing an appeal against the confirmation of the demand by the Commissioner, however as the relevant witnesses were not allowed to be examined, the matter was remanded back to the Commissioner with the direction to allow cross examination of the persons whose statements have been relied upon. 25. Considering the law as laid down in the various judgements, we feel that in the interest of justice it would be appropriate to remand the matter before the adjudicating authority to grant necessary opportunity in compliance with the provisions of Section 9D of CEA to the respondent to cross examine the witnesses relied upon by the revenue. 26. The respondent has raised cross objection to the findings of the Commissioner (Appeals). Firstly, the Commissioner (Appeals) has not recorded any findings on the issue that the demand is time barred. Secondly, if the Commissioner (Appeals) has held tha ..... 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