The Madras High Court bench here today dismissed a petition filed by Sanmar Foundries seeking to quash a show cause notice issued to it by Commissioner of Central Excise and Customs, Tiruchirappalli, last year for obtaining CENVAT credit by manipulating records.
Justice K K Sasidharan said the materials disclosed in the show cause notice and the statement made in the counter affidavit showed that the Commissioner had applied his mind and had formed a definite opinion regarding violation committed
by company.
The materials collected to fix the liability were disclosed in the show cause notice with a view to enable the company to submit its reply, the judge said.
The commissioner in a very fair manner disclosed all the materials collected during the course of investigation, the judge said.
The counsel for the company contended that the notice was issued with a pre-determined mind and no useful purpose would be served by holding further inquiry in the matter.
The Judge said "it is not as if the order of the Commissioner is final. The Central Sales Tax Act contains hierarchy of authorities. In case final order is passed by the authorities rejecting the company's explanation, the petitioner could approach the High Court", the judge said.
The company submitted that the officials, who conducted investigation for alleged violations of Central Value Added Tax (CENVAT) credit rules 2004, at their factory at Viralimalai, "humiliated" its officials and representative of the management.
The Commissioner had issued show cause notice to the company on November 29, 2013, charging that the company availed CENVAT credit by manipulating records.
The Judge said the show cause notice had been given only to enable the petitioner submit effective reply and rejected the plea to quash it.
