2003 (10) TMI 505 - AT - Central Excise

Summary

Issues:
1. Denial of Modvat credit and imposition of penalty under Rule 173Q.
2. Disallowance of credit based on original invoices.
3. Inadmissibility of credit against invoices issued by Metco services and trading.

Analysis:
1. The appeal addressed the denial of Modvat credit amounting to Rs. 1,69,302/- and a penalty of Rs. 15,000/- under Rule 173Q due to discrepancies in the invoicing process. The goods were purchased for a specific factory but invoiced in the name of the head office, later endorsed for a different plant. The tribunal found that the credit cannot be disallowed solely based on the invoice not being in the factory's name. The diversion of the consignment did not impact the entitlement to Modvat credit, as the discrepancy was rectifiable under Rule 57G(11). Since duty payment on inputs and their use in finished goods production was undisputed, the credit denial on this ground was unjustified.

2. Regarding the credit claimed from original invoices, it was observed that numerous invoices from different manufacturers were involved, with claims of duplicate copies being lost in transit. The tribunal noted the implausibility of all transporters losing duplicate copies and concluded that the appellants failed to substantiate their Modvat claim based on original documents. Consequently, the claim against original invoices was rejected.

3. The judgment also addressed the inadmissibility of credit against invoices issued by Metco services and trading. Critical particulars required by relevant notifications were found missing in these invoices. As a result, the credit taken against these invoices was deemed inadmissible by the lower authorities. The tribunal upheld this decision, affirming that the credit against invoices lacking essential particulars was correctly disallowed.

In conclusion, the tribunal partially allowed the appeal by permitting the credit related to the consignment diverted to Dombivili from the head office, amounting to Rs. 39,668/-. However, the claim for the remaining sum was disallowed. The appeal was disposed of accordingly, with the decision reflecting the specific findings on each issue raised during the proceedings.