2026-VIL-1169-CESTAT-CHD-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Penalty for abetting wrongful availment of CENVAT credit based on unsubstantiated allegations of bogus supplies, Absence of tangible evidence of non-manufacture, Denial of opportunity to cross-examine witnesses - Whether the appellant can be held liable for penalty for allegedly abetting wrongful availment of CENVAT credit by recipients when the allegation is based solely on investigations conducted at the recipient's end without any investigation at the appellant's premises – HELD - Similar issues involving identical facts have been consistently decided in favour of manufacturers in Jammu & Kashmir by this Tribunal and the Allahabad Bench. The evidence demonstrates that toll barrier entries certify movement of raw materials and finished goods, District Industry Centre officers regularly verified purchase consignments, Range staff conducted periodic checks at the factory and reported no adverse findings, and Pollution Control Department, District Industries Department and Electrical Department found the factory functioning - The Revenue failed to produce any investigation conducted at the appellant's premises and no concrete evidence has been brought on record to establish that the appellant was not a manufacturer. The allegations are based on presumption and assumption rather than substantive proof. The charge of abetting wrongful CENVAT credit requires tangible evidence, not merely inferences or unwarranted assumptions. The absence of cross-examination of witnesses undermines their reliability. When the allegation of bogus procurement and manufacture by Jammu-based units cannot be established, the allegation of bogus procurement cannot be sustained - The Original Authority appears to have been predetermined in its adjudication and failed to discharge its duty as an independent adjudicator by discarding concrete evidence – The impugned orders are set aside and the appeals are allowed
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