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TMI Blog2024 (8) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... g Central Excise duty of Rs.8,50,292/- which was found to be inadmissible to the appellant in view of the following facts: (a) Investigations were initiated by the DGCEI, Ludhiana Zonal Unit against M/s Blue Star Exports by way of search of the premises of the unit as well as proprietors of the firm and a statement of the proprietor Sh. Kesar Singh was recorded on 28.07.2015. Sh. Kesar Singh stated that he was not in possession of any documents and computer to show the department about the transaction made by them and everything will be available at M/s. Chandigarh Loha bhandar, Mandi Gobindgarh. He further stated that Sh. Varinder Kumar and Sh. Vijay Kumar are actual owner of the firm and he has been paid by them to act as proprietor of the firm on paper only. He further stated that the Registration of the firm has been taken on papers only and in-fact no goods are received at or stored at or sold from the godown located at Ranjit Nagar, Ludhiana and no invoice is issued at Ludhiana office. He also stated that only bills were issued by M/s. Blue Star Export for passing of Cenvat Credit and no goods are sold against these bills. (b) Statement of Sh. Varinder Kumar (referred as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were sold by us at the place of purchase only on cash basis. As already stated in my earlier statements dated 15.01.2016 and 01.03.2016, against these excisable/cenvatable purchases of both locally purchased & purchases made from other states we issued cenvatable sale invoices by changing the description of goods to cutting/ Def (defective) waste/scrap to the various furnace units of Mandi Gobindgarh without the actual supply of the purchased goods. As these units require scrap as raw material for the manufacture of their excisable goods which they procure from local market as Kabari scrap without bills to adjust their purchase we issued cenvatable sale invoices and passed the cenvat credit to them. As we had sold the purchased goods there only to small manufacturers on cash basis in the market, the cash received on such sales was given back to these furnace units and adjusted our finances. Same practice was applied to the goods which entered Punjab and had mention in the ICC barrier data of Punjab Excise & Taxation department. As these goods of first quality these were sold in the local market on cash basis. Their description was changed on the cenvat invoices as MS bar Defective( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1944. The penalty on persons responsible was also proposed in the show cause notice. After following the due process, the adjudicating authority confirmed the duty amounting to Rs.8,50,292/- under Section 11A(4) of the Central Excise Act, 1944 and appropriated the same as RG-23A Part-II Entry No. 447 dated 14.12.2016 along with interest. Aggrieved by the said order, the appellant filed appeal before the Commissioner (Appeals), who vide impugned order has dropped the personal penalty on partner but confirmed the duty and interest on the appellant. Hence, the present appeal. 3. Heard both the parties and perused the material on record. 4.1 The learned Counsel for the appellant submits that the impugned order is not sustainable in law as the same has been passed without proper investigation and without properly following the law. 4.2 He further submits that the material delivered to the appellant was purchased from the units situated at Mandi Gobindgarh, Punjab only and therefore, the appellant cannot be charged for taking the fake invoices just on the basis of ICC barrier report which is inapplicable to the present case. 4.3 He further submits that the appellant purchased entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istently held the credit cannot be denied to the assessee solely on the basis of the statement if no corroborative evidence is collected by the department to disprove the actual receipt of the goods. In this regard, he relies on the following decisions: (i) Chaudhary Steel Traders Vs Commissioner of C Ex. & S.T. Ludhiana reported as 2015 (329) E.L.T. 934 (Tri. Del) (ii) Mahindra Engineers Vs Commissioner of Central Excise, Ludhiana reported as 2015(320) E.L.T. 131 (Tri. Del.) (iii) Commissioner of C. Ex. Ludhiana Vs Talson Mills Store reported as 2015 (315) E.L.T. 415 (P&H) (iv) Bhakti Alloys Pvt. Ltd. Vs Commissioner of C. Ex. & S.T. Vadodara-I reported as 2016 (41) S.T.R. 554 (Tri. Ahmd.) (v) Commissioner of C. Ex. Mumbai-III Vs Samay Exports reported as 2014 (308) E.L.T. 119 (Tri. Mumbai) (vi) Motabhai Iron & Steel Industries Vs Commissioner of C. Ex. Ahmedabad-II reported as 2014 (302) E.L.T. 69 (Tri. Ahmd) (vii) Commissioner Vs Motabhai Iron & Steel Industries reported as 2015 (316) E.L.T. 374 (Guj.) 4.7 He further submits that the Commissioner (Appeals) in para 6.6 of the impugned order has set aside the penalty on the partner and once the penalty has been drop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement has not been retracted by Sh. Kuldip Singh till date. 5.4 In support of his submissions, the learned AR relies on the following decisions: * Beas Scientific Dyers Vs Commissioner of Central Excise, Ludhiana reported as 2014 (307) E.L.T. 596 (Tri. - Del.) * Nita Dyeing & Ptg. Works Vs Commissioner of Central Excise, Surat-I reported as 2005 (191) E.L.T. 180 (Tri. - Mumbai) * Commissioner of Central Excise, Chandigarh Vs Kisco Castings reported as 2010 (261) E.L.T. 190 (Tri. - Del.) * Prayagraj Dyeing & Printing Mills Pvt Ltd Vs Union of India reported as 2013 (290) E.L.T. 61 (Guj.) 5.5 As regards the dropping of penalty on the partner, the learned AR submits that Sh. Kuldip Singh, partner of the appellant has not filed the appeal before the Commissioner (Appeals) against the order-in-original passed by the original authority and dropping the penalty by the Commissioner (Appeals) does not affect the merits of the case. 6. After considering the submissions made by both the sides and perusal of the material on record, and also the statements of the persons recorded during the investigation, it appears that Sh. Varinder Kumar, who is the partner of M/s Blue Star Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s produced the invoice no. 425 dated 27.02.2015 issued by M/s Jai Ambey Profiles wherein the description/specification of the goods is mentioned as "ERW Pipe" and the tariff assessable value is shown as @37400.00 per MT and the said goods were sold by M/s Blue Star Exports to the appellant by invoice no. 198 dated 28.02.2015 by changing the description/specification of the goods from "ERW Pipe" to "ERW Pipe Cutting" so as to show it as scarp. In the invoice dated 28.02.2015 issued by M/s Blue Star Exports, it is mentioned the name of the manufacturer as "Jai Ambey Profiles - invoice in. 425 dated 27.02.2015", which clearly shows that within one day of purchasing the ERW Pipes, the same have been sold to the appellant by describing as ERW Pipe Cutting which is clearly manipulation and wrong availment of the Cenvat Credit by the appellant. 9. Further, I find that the appellant had voluntarily debited the Cenvat Credit availed on the strength of invoices issued by M/s Blue Star Exports on 14.12.2016 i.e. before the date of statement of Sh. Kuldip Singh, partner of the appellant, recorded on 07.09.2017 and he has not retracted his statement till date which clearly shows that he has ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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