Ecko Cables (P) Ltd. Vs Commissioner of Central Excise And Service Tax (CESTAT Chandigarh)
CESTAT Chandigarh allowed the appeal filed by M/s Ecko Cables against denial of CENVAT credit of Rs.16,63,743/-. The proceedings arose from a DGCEI investigation into M/s V.K Metal Works, Jammu, which alleged that the unit had no manufacturing facilities, had shown bogus receipt of raw material and manufacture, and had fraudulently passed on CENVAT credit to various customers. Ecko Cables, engaged in manufacturing electric wires and cables, was one of the customers against whom credit was sought to be denied.
A show-cause notice dated 09.06.2011 was issued seeking denial of the credit, which was confirmed by the Order-in-Original dated 20.02.2015 and affirmed by the Appellate Authority through the impugned order dated 26.07.2022.
Before the Tribunal, the Department objected to deciding the appeal on the ground that the CESTAT decision concerning M/s V.K Metal Works was under challenge before the Hon’ble High Court of Jammu Kashmir & Ladakh. The appellant submitted that there was no stay granted by the High Court and that the Tribunal had already decided cases involving similarly placed customers of M/s V.K Metal Works.
The Tribunal rejected the Department’s request to keep the proceedings pending, noting that no stay had been granted and that different Benches had already decided cases involving other customers of M/s V.K Metal Works. On merits, the Tribunal relied upon the Principal Bench’s findings that sufficient documentary evidence existed regarding transportation of copper scrap to M/s V.K Metal Works and that the Department’s own show-cause notice concerning “copper keeth” indirectly accepted manufacturing activity.
