ORDER
V.K. Agrawal, Member (T)
1. M/s. Aditya Trading Co. have filed this appeal against the penalty-imposed on them for having wrongly passed on the Cenvat Credit to the buyers.
2. Shri B.L. Narsimhan, learned advocate, submitted that the Appellants are engaged in the trading of Caustic Soda, Soda flakes, Soda Ash Light and Sodium Sulphate; that they are registered as a dealer with the Central Excise department; that they buy these materials from various dealers who in turn buy the said materials from the manufacturers; that in order to save transportation cost etc. the goods, for which the orders are placed by the Appellants on the dealers, are consigned directly by the manufacturers from their premises to the Appellants premises; that the goods are accompanied by the invoices issued by the manufacturer under Rule 52A of the Central Excise Rules, 1944; that these invoices duly indicate their name and address as the consignee of the goods; that further, in these invoices the buyer’s name
is intimated as the dealers from whom the appellants purchased the goods in transit; that after the goods are received the appellants sell them to various industrial consumers under invoice issued under Rule 57GG indicating the invoice number under which the consignment was originally received from the manufacturer and the details of duty payment; that the Dy. Commissioner under Order No. 47/2001, dated 27-8-2001 imposed a penalty on the ground that they were not supposed to pass Cenvat credit to their buyers on the strength of the invoices which were in the name of another person; that the Commissioner also under the impugned Order has rejected their appeal holding that Cenvat Credit could be availed by the end user which the appellants were not; that the Commissioner (Appeals) had also given his findings that the invoices issued by them were not got authenticated by the proper officer. The learned Advocate, further, submitted that the invoices issued by the manufacturer indicated the name of the dealers from whom the appellants purchased the goods; that in addition those dealers have also raised commercial invoices on the appellants giving indication and reference to the invoice raised by the manufacturer; that in view of this no penalty is imposable on them; that further there is no dispute about the duty paid nature of the goods and there is also no dispute about the fact that the manufacturer from whom they received the consignment directly has paid the appropriate duty on these consignments; that there is no dispute about the exact co-relation of the goods received by them and the goods sold by them; that it is also not the case of the department that the appellants had entered particulars in the invoices issued by them which were wrong or incorrect and with intent to enable their customers to take Cenvat credit. Finally he submitted that there is no provision in the Rules about pre-authentication of invoice issued by the second stage dealer; that Rule 57G(2) clearly provides that where invoice issued by a registered dealer did not contain certain details and did not contain certain procedural requirement Credit cannot be denied if the duty paid nature of the goods is not in dispute.
3. Countering the arguments Mrs. Charu Baranwal, learned SDR, submitted that the appellants are second stage dealer i.e. a dealer who purchase the goods from a first stage dealer; that the invoices issued by the manufacturer under Rule 52A of the Central Excise Rules did not show the name of the appellants as the buyers; that as the invoices were issued to some other buyers the appellants cannot have issued the Modvatable invoices to their customers.
4. We have considered the submissions of both the sides. It has not been disputed by the Revenue that the invoices issued by the manufacturer under Rule 52A of the Central Excise Rules did mention name of the appellants and the goods on which Central Excise duty had been paid were received by the appellants. No doubt against the name of buyers, the names of some other parties were mentioned. These parties, according to the appellants, were the first stage dealer who were directly purchasing the goods from the manufacturer and that in view to save transportation cost they requested the manufacturer to send the consignment directly to the appellants. It has also not been disputed by the Revenue that the buyers whose names appear in the invoices issued by the manufacturer had further issued commercial invoices to the appellants. The receipt of the duty paid goods has also
not been disputed by the Revenue. On the basis of the documents received by them the appellants have issued Modvatable invoices to the customers who have purchased the materials from them. Under Rule 57AE of the Central Excise Rules at the relevant time an invoice issued by a second stage, dealer of excisable goods under Rule 52AA was a duty paying document for the purpose of availment of Cenvat credit. Merely because the invoices issued by the manufacturer contained the name of buyers (first stage dealer), validity of the duty paid nature and the fact that the consignment has been received by the appellants cannot be disputed. We, therefore, find no reason for imposing any penalty on the appellants. Accordingly the impugned Order is set aside and the appeal is allowed.