Custom, Excise & Service Tax Tribunal
M/S Ganapati Alloys vs Commissioner, Central Excise & Service ... on 23 November, 2015
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad Appeal No.E/432-434/2011-SM [Arising out of OIO No.02/Dem/Vapi/2011, dt.20.01.2011, passed by Commissioner, Central Excise & Service Tax, Vapi] 1. M/s Ganapati Alloys, 2. Shri Pawan Kumar Gupta, 3. Shri R.B. Yadav. Appellants Vs Commissioner, Central Excise & Service Tax Vapi Respondent
Represented by:
For Appellant: Shri R. Subramanya, Advocate For Respondent: Shri S.K. Shukla, A.R. For approval and signature:
Honble Mr. P.K. Das, Member (Judicial)
1. Whether Press Reporters may be allowed to see the No Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen the order?
4. Whether order is to be circulated to the Departmental Yes authorities?
CORAM:
HONBLE MR. P.K. DAS, MEMBER (JUDICIAL) Date of Hearing/Decision:23.11.2015 Order No.A/11791-11793/2015, dt.23.11.2015 Per: P.K. Das The relevant facts of the case, in brief, are that M/s Ganpati Alloys, the Appellant-firm was engaged in the manufacture of M.S. Ingots, classifiable under Chapter 72 of the Schedule to the Central Excise Tariff Act, 1985. There was a flood in the Appellants factory on 02.08.2004 and the entire factory was submerged into the water of Damanganga river. The Appellants informed the Central Excise officers of the damage of the goods and records due to the flood. On 05.08.2004, the Central Excise officers visited the Appellants factory premises and recorded the destruction of records and the goods and prepared Panchnama. During EA-2000 Audit conducted by the Central Excise officers, it was found that the original copy of CENVAT invoices of Rs.71,63,191.00 were not available. A Show Cause Notice dt.05.11.2007 was issued, proposing to deny CENVAT Credit of Rs.71,63,191.00 alongwith interest and to impose penalty for the month of January 2003 to June 2005. The Adjudicating authority confirmed the demand of CENVAT Credit of Rs.43,72,859.00 alongwith interest and imposed penalties. The Tribunal by Final Order No.A/393-395/WZB/AHD/2010, dt.03.05.2010 remanded the matter to the Adjudicating authority with certain direction. By the impugned order, in denovo Adjudication, the Commissioner of C.Ex. & Customs, Vapi disallowed the CENVAT Credit of Rs.43,72,859.00 alongwith interest and imposed penalty of equal amount of CENVAT Credit. It has also imposed penalty of Rs.1 lakh on Shri Pawan Kumar Gupta, Proprietor and a penalty of Rs.10,000.00 on Shri R.B. Yadav, Authorised Signatory of the Appellant firm.
2. The learned Advocate on behalf of the Appellants contested the demand on merit and on limitation. He submits that there is no dispute that at the time of availing CENVAT Credit, the Appellant possessed the original copy of the invoices, which were lost during the flood and therefore, the CENVAT Credit should be allowed on the basis of photo-copy of the invoices. He further submits that the photo-copy of the invoices has to be accepted for the purpose of verification. It is further submitted that the CENVAT Credit was taken during the period January 2003 to June 2005 and Audit was conducted on 31.03.2006. It is further submitted that the Show Cause Notice was not issued within one year from the date of Audit, and therefore, the demand is barred by limitation.
3. On the other hand, the learned Authorised Representative for the Revenue submits that the Appellants had not informed the loss of original copy of invoice, which was detected by the Audit during verification of the records. He further submits that it is a clear case of suppression of facts with intent to evade payment of duty and therefore, extended period of limitation would be invoked. He drew the attention of the Bench to the relevant portion of the Adjudication order. He also submits that the Tribunals remand order is only for verification of records.
4. After hearing both the sides and on perusal of the records, I find that that this is second round of litigation. For proper appreciation of the case, the relevant portion of the Tribunals order dt.03.05.2010 is reproduced below:-
5. We find force in the above submission of the learned advocate. As more documents, on the basis of which the Commissioner has earlier granted relief, stand produced by the appellant before us now, we set aside the impugned order and remand the matter to the Commissioner for verification. He shall also reconsider the appellants submission that the documents were washed away in flood and were not available for reconstruction of the file. At this stage, the learned advocate also explained that there are around 6 invoices issued after the flood incidence, in respect of which the MODVAT Credit also stand denied. We leave the said issue for Commissioner to decide afresh in de-novo proceedings.
5. On perusal of the impugned order, I find that during de-novo Adjudication, the Appellants stated before the Adjudicating authority that they do not have any new or other documents except the documents submitted at the time of earlier Adjudication. Thus, the Appellants had not produced any documents in terms of Tribunals order before the Adjudicating authority in denovo Adjudication. Hence, I do not find any substance in the submission of the learned Advocate on merit.
6. Regarding the issue on time bar, the Adjudicating authority observed as under:-
7.3 ..The panchnama has been drawn as per sayings of Shri Mishra that the entire office as under the water level and due to this problem, the entire records were highly damaged; that few records for the period 02.02.2004 to 03.08.2004 relating to Excise, Accounts and other miscellaneous were not available and few records which were available for the said period, were not legible due to flood water. Thus, though the Panchnama was drawn by the Range officers but the facts were recorded as per what was stated by the authorized signatory of the Assessee unit. The then Commissioner in his OIO No.07/Dem/Vapi/2009 has held that the Assessee had never intimated that the Cenvatable documents were lost in flood and instead they had collected zerox copies in support of Cenvat availment; that the assessee suo moto never came forward to the Department with the plea that they were not having copies of certain cenvatable invoices on which they had taken CENVAT Credit but it was detected during the course of audit only; that their willful intention to evade payment of duty is also proved from the fact that after flood, they had intimated to the Department regarding loss of goods due to flood but they did not inform that they had lost cenvatable documents also in the flood. Thus, the plea that the demand is time barred is held as non-acceptable and rejected.
7.On a query from the Bench, the learned Advocate submits that they failed to produce the original copy of the invoice even for the period January 2005, February 2005, May 2005 and June 2005 which has no relation with the flood. It is seen from the records that the Appellants had not informed the Department about the loss of invoices during the flood. This fact was detected during the audit conducted by the Central Excise officers. Hence, I find force in the findings of the Adjudicating authority. In the facts and circumstances of the case, the extended period of limitation would be invoked.
7. There is a force in the submission of the learned Advocate that it is a proprietary-ship firm and therefore, imposition of penalty on the Proprietor cannot be sustained. It is also noticed that the Appellant No.3 is an Authorised Signatory and therefore, no penalty should be imposed upon him.
8. In view of the above discussion, the appeal filed by M/s Ganapati Alloys (Appellant No.1) is rejected. The appeals filed by the Appellant Nos. 2 & 3 are allowed.
(Dictated & Pronounced in Court) (P.K. Das) Member (Judicial) cbb ??
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