By Puloma Dalal, Jayesh Gogri, Chartered Accountants
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CENVAT credit taken on the basis of invoices of an importer – Importer stated in his Statement that most of the goods were actually not supplied – He issued only invoices without actual supply of goods – Appellant provided evidences like transport company’s GRs, Dharmakanta receipts, bank statements indicating payment to the supplier – Held, the importer made a statement which was not retracted by him – Credit cannot be allowed.
Facts:
The appellant was a manufacturer and availed credit on the basis of invoices issued by Shulabh Impex Incorporation supplier-importer having Dealer’s registration (supplier). The Revenue gathered intelligence that the said supplier is issuing fake invoices. On being raided, the proprietor of the supplying firm made a statement that he was not in a capacity to import goods therefore, some other people have imported goods using his IEC code and that he has issued only invoices in most of the cases without actual supply of goods. Therefore, CENVAT credit claimed by the appellant was disallowed by the Revenue. The appellant argued that as per the statement of the supplier, not all the invoices were fake. Moreover, other evidences like GRs issued by transport companies, the receipts issued by Dharmakanta (weigh bridge) and the entries in the bank statement showing payments made to such supplier proved that the appellant actually purchased goods from the supplier and therefore entitled to take the credit in respect of invoices of such supplier.
Held:
Since the statement made by the supplier was not retracted by him, the same needed to be accepted as the truth and therefore, it was held that the CENVAT credit cannot be availed by the appellant on the basis of such fake invoices.
