2002 (2) TMI 1175 - AT - Central Excise

Summary

Issues: Disallowance of Modvat credit for improper declaration and manufacturer details.

Issue 1: Disallowance of Modvat credit due to improper declaration.

The appellant company availed Modvat credit amounting to Rs. 22,290.17, which was disallowed because the classification in the invoices did not match the classification declared by the appellants. The appellants argued that despite the discrepancy in tariff headings, the description of the goods in both the invoices and their declaration was consistent as "Iron Castings." The judge agreed with the appellant, citing previous tribunal decisions that minor differences in classification should not be the basis for denying the credit. The judge emphasized that the description of goods being the same should be sufficient to allow the Modvat credit.

Issue 2: Disallowance of Modvat credit for improper declaration of specific items.

Another part of the Modvat credit was disallowed due to a discrepancy in the description of inputs in the invoices and the declaration. The appellants declared the inputs as "Electrode" while the invoices described them as "Ferropead Plus." The appellants contended that "Ferropead Plus" was the brand name of the "Electrode" and fell under the same classification. The judge agreed with the appellants, stating that the minor difference in the brand name should not lead to denial of credit, especially when the classification matched.

Issue 3: Disallowance of Modvat credit for missing manufacturer details.

An additional amount of Rs. 23,899.42 was denied to the appellants because the dealers' invoices did not provide the particulars of the manufacturers/importers in the correct form. However, the appellants rectified this discrepancy by submitting a letter from the dealers with the manufacturer's details. The judge noted that minor defects like missing manufacturer details, if rectified subsequently, should not be the sole reason for denying the credit, especially when there was no allegation of non-receipt of the inputs. The judge set aside this portion of the demand and remanded the matter to the Assistant Commissioner for further review based on the provided letter, allowing the benefit of Modvat credit if the details were found to be correlatable to the invoices.

In conclusion, the judgment partially allowed the appeal and remanded a portion for further review, emphasizing that minor discrepancies in classification or missing details should not automatically result in the denial of Modvat credit if the essential information regarding the goods was consistent and subsequently rectified.