OMKAR TRADERS Vs. COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD

JUDGEMENT

(1.) THE appellant is a dealer in grey fabrics. During the year 2003, when textiles were brought into cenvat network, appellant was eligible to pass on the credit of duly paid on the grey fabrics to the manufacturers. Appellants were required to file the declaration of the stock as on 31 -3 -2003 as per Notification No. 35/2003 -C.E. (N.T.), dated 10 -4 -03. Vide Notification No. 40/2003 -C.E. (N.T.), dated 30 -4 -2003 appellants were required to give an intimation to the department if there is any change in the declaration already filed by them. Admittedly, the appellants filed declarations on 26 -5 -2003 and 10 -6 -2003 declaring the stock as on 31 -3 -2003. Appellants were required to make a declaration on stock as on 31 -3 -2003 or before 26 -5 -2003 which was extended to 15 -6 -2003. Appellants had filed a declaration on 7 -4 -2003 but they were required to file another declaration before 30 -4 -2003. The appellants made two declarations but simply declared the stock as on 31 -3 -2003.

(2.) THEREAFTER a show cause notice was issued on 10 -5 -2004 wherein the credit of Rs. 1,36,936/ - taken by them was held to be ineligible on the ground that they had not given any further declaration of stock lying as on 1 -4 -2003 or any intimation regarding no change of stock as on 31 -3 -2003 and 1 -4 -2003.

(3.) HEARD both the sides. The learned advocate submits that the only omission on their part is that while submitting further declarations they did not specifically indicate that there was no change in stock. He submits that it is nobodys case that the stock details given in the three declarations filed by them were different in any of the declarations. The stock remained the same in all the three declarations. However, subsequently by the time the Department issued a show cause notice and adjudication process started, Sales tax Department had taken away the records and therefore they were not able to produce the relevant records. Further, the promise given by the authorized signatory that he would produce a certificate from the Sales tax department also could not be fulfilled and the learned advocate could not explain why such a promise was made and not fulfilled. However, he submits that in the income tax return the quantity was not required to be mentioned and the total quantity if it is verified by the invoices submitted by them along with the value with the income tax return which gives the value, would show that the value lying on 31 -3 -03 as per the invoices and as per the income tax return would tally. He also submits that none of the departmental authorities have verified this aspect. In any case no investigation has been conducted on the invoices submitted by them to show that they were not genuine. Admittedly, at this late stage it is not possible to verify the stock and further it is also to be noted, even though it was not noted by any of the lower authorities that the appellant was only a dealer and not a manufacturer and was treated as a deemed manufacturer in terms of the law as it stood at that time. Learned DR on the other hand submits that the appellants failed to produce any proof to show that the stock was lying as on 31 -3 -2003 and the invoices produced by them have been found to be rather new by the superintendent and therefore not reliable. He also submits that originally the appellants had taken a stand that they do not have any documents but subsequently they have produced the invoices. The question arises from where these invoices suddenly came from?