M/S.Fibro Plastichem (I) Pvt.Ltd vs Cce-Kol-Iii

(Arising out of Order-in-Appeal No.17/Kol-III/2011 dated 25.01.2011 passed by the Commissioner(Appeal-I) of Central Excise, Kolkata.)

FOR APPROVAL AND SIGNATURE

HONBLE DR. D.M. MISRA, MEMBER(JUDICIAL)

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

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

3. Whether Their Lordship wishes to see the fair copy of the Order?

4. Whether Order is to be circulated to the Departmental Authorities?

M/s.Fibro Plastichem (I) Pvt.Ltd.

Applicant (s)/Appellant (s)

Vs.

CCE-KOL-III

Respondent (s)

Appearance:

Shri K.K.Banerjee, Advocate for the Appellant (s)

Shri A.Roy, Supdt.(AR) for the Revenue (s)

CORAM:

Honble Dr. D.M. Misra, Member(Judicial)

Date of Hearing/Decision :- 09.10.2015 Date of Pronouncement :- 09.10.2015

ORDER NO.FO/A/75618/2015

Per Dr. D.M. Misra.

1. This is an appeal filed against Order-in-Appeal No.17/Kol-III/2011 dated 25.01.2011 passed by the Commissioner(Appeal-I) of Central Excise, Kolkata.

2. Briefly stated facts of the case are that the appellant had cleared manufactured excisable goods against three invoices dated 10.10.2006, 14.10.2006 and 02.11.2006 on payment of a total duty of Rs.2,05,374/-. Later claiming that the goods were received back in their factory since could not be delivered at the consignees address, on 25.01.2007 the appellant had availed CENVAT Credit of the duty paid on these invoices under Rule 16 of the Central Excise Rules, 2002 along with excess credit of Rs.40,367/-. Demand has been confirmed, penalty imposed on the ground that the appellant could not place sufficient evidence of receipt of the said goods cleared earlier like, rejection letter from the consignee, transit documents by which it could be shown that the goods have been received back by the appellant in its factory. Aggrieved by the said order the appellant preferred an appeal before the ld. Commissioner(Appeals), who in turn confirmed the order of the adjudicating authority rejecting the appeal filed by the appellant. Hence the present appeal.

3. The ld.Advocate Shri K.K.Banerjee for the appellant submits that the entire material cleared initially in Oct./Nov. 2006 has been received on 25.01.2007 because the same could not be delivered at the consignees address. Further, he submits that the said goods were brought back through Associated Road Carriers against consignment note No.872631. Therefore, the CENVAT Credit availed on return of the goods, under Rule 16 of the Central Excise Rules, 2002, cannot be denied to them. Further, he submits that there was no mala fide intention in availing the excess credit of Rs.40,367/- which was later reversed by them before issuance of show cause notice. It is his submission that the demand notice has been issued for the normal period of limitation and since there is no suppression of fact or mis-declaration, therefore, penalty imposed under Rule 15(2) read with section 11AC is unwarranted and uncalled for.

4. Per contra, the ld.AR for the Revenue on the other hand submits that from the consignment note, it is not clear whether the same goods cleared initially were returned back in asmuch as there is no reference of the invoices in the said consignment note nor the quantity mentioned in the consignment note match with the total quantity mentioned in the invoices. Therefore the appellant could not establish that the duty paid materials mentioned in the invoices cleared earlier on payment of duty, were returned.

5. Heard both sides and perused the record..

6. The short point involved in the present case is whether the appellant are eligible to CENVAT Credit of Rs.2,01,345/- on the duty paid by them on the goods cleared by them initially against three invoices, which were claimed to have been returned being undelivered to the consignee mentioned in those invoices. The bone of contention is that whether the material initially cleared were received back for the purposed mentioned under Rule 16(1) of the Central Excise Rules, 2002. On going through the consignment note annexed at page 11 of the appeal memorandum, it is difficult to accept the submission of the appellant that the same materials were received back which were initially cleared, against the central excise invoices. The authorities below had rejected the contention on the ground that the appellant could not adduce sufficient evidence to establish that the materials had been received back in the factory premises. I agree with the said finding. Therefore, in my considered view the Appellant are not eligible to avail the CENVAT Credit of the duty paid against the referred invoices. However, insufficiency of evidence in establishing the return of goods, cannot be construed as suppression of fact. In the result, imposition of penalty under Rule 15(2) read with section 11AC in the present case is unwarranted. Consequently, the penalty imposed on the Appellant is set aside and the appeal is partly allowed to the extent of imposition of penalty under Rule 15(2) read with section 11AC. The demand for recovery of the CENVAT Credit of Rs.2,05,374/- and interest is however confirmed. Appeal disposed of as above.

(Pronounced and dictated in the open court.)

SD/

(D.M.MISRA) MEMBER(JUDICIAL) sm

4 Appeal No.EA-265/11