Order date – 13 June 2022

Facts:

• The appellant, Atul Madhavji Parekh, has acted as a broker for supply of goods by M/s Shah Foils Ltd. to M/s Bluplast industries Ltd. The Second appellant, Sri Ram Steels has carried out the job work on the goods supplied by M/s Shah Foils to M/s Bluplast.
• The appellants have been charged for facilitation of collecting fraudulent CENVAT Credit by M/s Bluplast on fake invoices issued by M/s Shah Foils on non-supply of goods. Accordingly, a penalty was imposed by the Adjudicating Authority on appellants under Rule 26 of Central Excise Rules, 2002 
• The Learned Commissioner (Appeals) upheld the given order. Being aggrieved by the order of the Commissioner, an appeal is filed before the tribunal.

Issue:

• Whether the appellant can be charged under Rule 26 of Central Excise Rules, 2002 to abetment of passing on fraudulent CENVAT Credit?

 Order:

• The Tribunal stated that in the main case of M/s Shah foils, it was earlier held by the tribunal and reiterated by Hon’ble Supreme Court that goods have been supplied on the correct invoices and accordingly the charge was set aside.
• From the above observation of this tribunal in the case of M/s. Shah Foils Ltd. it was held that the contention of the revenue is not sustainable regarding charge of issuance of invoices without actual clearance of goods. Since, the tribunal in the above decision clearly held that the goods have been supplied along with invoices. The charges against the present appellants are not sustainable.
• Hence, the Tribunal held that appellants are not liable to penalty under Rule 26 of Central Excise Rules and the penalty is set aside. Appeals allowed.