Case Details: Ashirwad Foundries Pvt. Ltd. vs. Commissioner Of CGST And Central Excise (2025) 37 Centax 70 (S.C.)
Judiciary and Counsel Details
- B.V. Nagarathna & R. Mahadevan, JJ.
- S/Shri A.K. Prasad, Jitin Singhal, Ms Surabhi Sinha, Prashant Pathak, Advocates & Sanjeev Malhotra, AOR, for the Petitioner.
- S/Shri N. Venkataraman, A.S.G., Ms Nisha Bagchi, Rajat Nair, Udai Khanna, Raghav Sharma, Ms Sonali Jain, Ms Alka Agarwal, Zoheb Hussain, Advocates & Gurmeet Singh Makker, AOR, for the Respondent.
Facts of the Case
The assessee was alleged to have fraudulently claimed Cenvat credit on the strength of invoices issued by non-existent input suppliers. It was alleged that the transactions were fictitious, that the input suppliers were non-existent, and that the cenvatable invoices were fraudulent in nature. Statements of the assessee’s director and other witnesses were recorded, wherein it was admitted that the transactions were fictitious and that the input suppliers were non-existent. It was further alleged that the registration details of vehicles claimed to have been used for transportation of inputs indicated that such vehicles were three-wheelers, mopeds, etc., and not trucks. The Calcutta High Court, in the impugned order, considered the unretracted statements of witnesses and the material produced by the department to establish fraudulent availment of Cenvat credit, and held that the assessee had failed to discharge the burden of proof to show that the transactions were genuine. The High Court further held that mere payment through banking channels and voluntary payment of service tax on transportation services availed by the assessee as service recipient would not make the transactions genuine, and denied Cenvat credit under Rule 3 read with Rules 4 and 9 of the Cenvat Credit Rules, 2004. The matter was accordingly placed before the Hon’ble Supreme Court.
Supreme Court Held
The Hon’ble Supreme Court held that the impugned order passed by the High Court was a well-reasoned order. It held that the High Court had considered unretracted statements of witnesses and the material produced by the department regarding non-existent suppliers, fraudulent invoices and vehicle details. The Court held that mere payment through banking channels could not make fictitious transactions genuine. Accordingly, it was held that the impugned order did not call for interference and dismissed the special leave petition.
List of Cases Cited
- Commissioner v. Ashirwad Foundries Pvt. Ltd. — (2023) 4 Centax 265 (Cal.) — Affirmed [Para 2]
