Ceeson Exports vs C.C.E. & S.T. Ludhiana

Date of Pronouncement: 16/07/2015

Appeal No. E/55077/2014-EX(SM)

(Arising out of OIA No. LUD-EXCUS-000-APP-172-14-15 dated 27.06.2014 passed by Commissioner (Appeals) Customs & Central Excise, Chandigarh)

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair copy of the order?

4. Whether order is to be circulated to the Department Authorities?

Ceeson Exports Appellant

Vs.

C.C.E. & S.T. Ludhiana Respondent

Appearance:

Present for the Appellant: Shri Harvinder Singh, Advocate

Present for the Respondent: Shri R.K. Grover, DR

Coram: Honble Ms. Sulekha Beevi C.S., Member (Judicial)

Final Order No. 52223/2015

Per: Sulekha Beevi C.S.

The appellants are aggrieved by the Order-in-Appeal passed by the Commissioner (Appeals) upholding the demand for recovery of Cenvat credit and imposition of penalty on the ground of wrongful availment of credit.

2. The appellants are engaged in manufacture of fence fittings and gate accessories. They were also availing Cenvat credit. According to the Department the appellant availed Cenvat credit of Rs.39,574/- on 10.910 MT Flat Bars on the basis of the invoices issued fraudulently by a Dealer (who was registered with Central Excise) namely M/s S.K. Garg & Sons in violation of the provisions of law. That at the material period of time the Dealer did not have a godown to store the excisable goods and thus the appellant indulged in paper transactions only in connivance with the dealer. The Show Cause Notice finalized in the order confirming the demand alongwith interest and penalty against which appeal was preferred by the appellant. The Commissioner (Appeals) upheld the order passed by the Primary adjudicating authority. Hence this appeal.

3. At the time of hearing, the learned Counsel for the appellant submitted that the demand alongwith interest and 25% of the penalty has already been deposited. He urged for a reduced penalty. This was vehemently opposed by the DR who submitted that there were no grounds for reducing the penalty.

4. On perusal of records it is seen that on investigation it was found that the Dealer had no godown and the address of godown given by Dealer for obtaining registration was fake. There was no evidence for transportation of the goods from the godown to the appellants factory and the transactions were only paper transactions. On the other hand, on behalf of the appellants it is submitted that all payments for the consignments were made to the dealer by way of cheque and that manipulation if any is only at the Dealers end. When such misuse of the beneficial provision of Credit is alleged, the burden is upon the assessee/appellant to establish his innocence. Appellants do not have a case that appropriate duty has been paid by the dealers. The appellant being a manufacture who avails credit is bound to ensure the same. If the appellant purchased the goods from the Dealer, he should definitely know and ensure the whereabouts of the office and godown of dealer. As the appellant is unable to furnish such details, it is clear that the dealer had no such godown and only invoices were issued without physical movement of goods. In such circumstances I do not find any grounds to interfere with the impugned order.

5. In the result, the impugned order is upheld. The appeal is dismissed.

(Pronounced on 16/07/2015)

(Sulekha Beevi C.S.)

Member (Judicial)

K. Gupta

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