2003 (9) TMI 639 - AT - Central Excise

Summary

Issues:
1. Dispute over Modvat claim of Rs. 2.4 crores.
2. Denial of credit due to lack of prescribed duty paying documents.
3. Loss of original documents due to flooding.
4. Certification by Central Excise authorities confirming receipt of goods and loss of documents.
5. Appellants' justification for taking credit against copies of documents.
6. Legal requirements for Modvat credit.
7. Interpretation of rules regarding duty paying documents.
8. Tribunal's decision in a similar case.
9. Justification for denial of credit by the Central Excise authorities.
10. Examination of records and arguments by both parties.
11. Acceptance of receipt and installation of capital goods by jurisdictional authorities.
12. Production of certified copies of documents by the appellants.
13. Lack of objection regarding delay in taking credit.
14. Justification for denial of credit based on available documents.
15. Tribunal's decision supporting the appellants' claim.

Analysis:
The case involved a dispute over a Modvat claim amounting to Rs. 2.4 crores by the appellant, M/s. Cochin Refineries Ltd., for goods used in an expansion project. The credit was denied due to the unavailability of prescribed duty paying documents. The appellant procured goods in 1994-95 from a supplier, but the original documents were lost in a flood. Copies of the documents were obtained from the supplier, and the Central Excise authorities confirmed the receipt of goods and the loss of documents through a certificate. The appellants argued that the loss of documents was confirmed, and they were justified in taking credit against the copies. The appellants emphasized that there was no time limit for taking credit on capital goods and that credit could only be claimed after installation, which was completed in 1998. The Tribunal had previously ruled that credit should not be disallowed based on attested photocopies of gate passes if the duty paid character of goods was established.

Upon reviewing the case records and arguments from both sides, the Tribunal found that the transaction was legitimate, with the authorities accepting the receipt and installation of capital goods. Despite the loss of original documents, the appellants produced certified copies showing payment details and duty paid amounts. The Tribunal concluded that the denial of credit was unjustified as the copies of prescribed documents provided sufficient evidence of duty payment. The delay in claiming credit was also deemed acceptable as it could only be done post-installation. Citing a previous Tribunal decision supporting the appellants' position, the Tribunal allowed the appeal, overturning the initial order denying the Modvat credit.