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TMI Blog2024 (10) TMI 891X X X X Extracts X X X X X X X X Extracts X X X X ..... ceiving Menthol, Menthol Flakes and De-Mentholized Oil in its premises as raw materials from it suppliers i.e. J K manufacturers and was consequentially manufacturing the finished goods and has rightly availed the CENVAT credit. Further, it is found that the demand for penalty would not arise if the demand against the Principal Appellant is not sustainable and in the present case, the demand against the Principal Appellant is itself set aside by this Tribunal holding that the impugned goods were actually received by the Principal Appellant supplied by the appellant and other J K manufacturers. Further, the penalty under Rule 26(2) has been imposed whereas during the relevant period, the said Rule did not exist and the same came into existen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their final products for domestic clearances as well as on export of goods under rebate claim. Thus, investigations were initiated by the officers of Central Excise of Meerut-II Commissionerate against the Principal Appellant. During the said investigation, summon were issued to the proprietor of the Principal Appellant and his statement was recorded. Also, list of suppliers from whom raw materials were procured for manufacturing of final products was sought from Principal Appellant. Appellant was one such supplier based in J K who was supplying Menthol and Menthol Solutions ( Impugned goods ) to Principal Appellant. The appellant was availing the benefit of refund of central excise duty paid from PLA account in terms of the Area-based Exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of final products. On these allegations, Show Cause Notice dated 05.01.2010 was issued to the Principal Appellant proposing to deny CENVAT credit on the strength of fake invoices issued by J K based manufacturers as no impugned goods were manufactured by J K based manufacturers. Further, penalty was proposed to be levied on the Appellant under Rule 26 of the Rules on the ground that the Appellant never had adequate infrastructure nor produced/ received any excisable goods during the relevant period and had colluded with Principal Appellant in order to pass on fraudulent credit to them and knowingly and willfully fabricated the production/ procurement and clearance records and returns without actual production/procurement and clearance of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its premises as raw materials from its suppliers i.e., J K manufacturers and was consequentially manufacturing the finished goods. Therefore, it has been held that Principal Appellant was rightly availing the CENVAT Credit. 6. Learned Counsel for the appellant further submits that when the entire demand stands demolished in the present case and thus, the demand upheld vide the impugned order are liable to be set aside on this ground. She also submits that in the appellant s own case in M/s Ruchi Infotek Systems VS CCE, J K- 2019 (3) TMI 1493-CESTAT Chandigarh, this Tribunal passed the order in favour of the Appellant wherein the Tribunal categorically held that sufficient records were shown by the Appellant to prove that impugned goods wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra and the matter has attained finality by the decision of the Tribunal in the case of Principal Appellant and suppliers of the appellant in the case of M/s Neeru Enterprises cited supra wherein it has been held that Principal Appellant was receiving Menthol, Menthol Flakes and De-Mentholized Oil in its premises as raw materials from it suppliers i.e. J K manufacturers and was consequentially manufacturing the finished goods and has rightly availed the CENVAT credit. Further, we find that the demand for penalty would not arise if the demand against the Principal Appellant is not sustainable and in the present case, the demand against the Principal Appellant is itself set aside by this Tribunal holding that the impugned goods were actually r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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