2006 (1) TMI 377 - AT - Central Excise

Summary

Issues:
- Entitlement to Modvat credit and penalty imposition based on loss of duplicate copy of invoice.

Analysis:
The appeal was filed by the Revenue challenging the allowance of credit by the Commissioner to the respondent. The Revenue argued that since the respondent did not approach the Assistant Commissioner regarding the loss of the duplicate copy of the invoice, they are not entitled to Modvat credit, and the penalty imposed on them is justified. The Revenue contended that the order of the Commissioner allowing the credit was incorrect.

On the other hand, the respondent argued that their credit related to October 1999 and cited an amendment to sub-rule (6) of Rule 57G, which allowed manufacturers to take credit on inputs received in the factory even if the duplicate copy of the invoice was lost in transit, subject to the satisfaction of the Assistant Commissioner. The respondent emphasized that the only requirement for satisfaction was that the goods were received in the factory and duty was paid on the inputs. They relied on various decisions to support their argument.

The Tribunal examined the relevant Rule 57G(6) of the Central Excise Rules, which stated that credit on inputs could be allowed based on the original invoice if the duplicate copy was lost in transit, provided the Assistant Commissioner was satisfied that the inputs were received in the factory and duty was paid on them. The Tribunal noted that in this case, there was no dispute that the goods were received in the factory and duty was paid. The respondent had explained the loss of the duplicate copy, supported by an affidavit. Therefore, the Commissioner had correctly determined that the respondent was eligible for credit on the original copy, and the nature of duty payment was not in question. Consequently, the Tribunal found no merit in the Revenue's appeal and rejected it.

In conclusion, the Tribunal upheld the Commissioner's decision, emphasizing that as long as the Assistant Commissioner is satisfied that the goods were received in the factory and duty was paid, credit on the original invoice can be allowed even if the duplicate copy is lost. The Tribunal's ruling highlighted the importance of compliance with procedural requirements and the satisfaction of the relevant authorities in claiming Modvat credit.