2007 (7) TMI 484 - AT - Central Excise

Summary

Issues:
Denial of Cenvat Credit on capital goods purchased from a Free Trade Zone.

Analysis:
The appeal before the Appellate Tribunal CESTAT, Mumbai challenged the Order-in-Appeal denying Cenvat Credit to the respondent on capital goods bought from M/s. Novartis Enterprises Ltd. in the Free Trade Zone, Kandla. The Revenue contended that the respondent was ineligible for Cenvat Credit as the invoices from M/s. Novartis Enterprises Ltd. did not comply with Rule 9 of the Cenvat Credit Rules 2004. However, the ld. Commissioner (Appeals) allowed the appeal, emphasizing that the Capital Goods were received and used for manufacturing final products, and the Cenvat Credit was availed correctly based on valid duty paying documents issued by M/s. Novartis Enterprises Ltd.

The ld. Commissioner (Appeals) noted that the appellants had purchased the capital goods from M/s. Novartis Enterprises Ltd., who issued bills with excise duty separately mentioned. The Commissioner found no dispute regarding the receipt and use of capital goods in manufacturing. Despite the Revenue's failure to provide evidence that the invoices did not mention excise duty, it was established that M/s. Novartis Enterprises Ltd. had proper import permissions and followed all necessary procedures. The record confirmed that the capital goods were received and utilized by the appellants in their factory premises, leading to the conclusion that the Cenvat Credit availed was valid and in compliance with Rule 9 of the Cenvat Credit Rules 2004.

In light of the above findings, the Appellate Tribunal upheld the order-in-appeal, deeming it correct and legally sound without warranting any interference. Consequently, the appeal filed by the Revenue was dismissed, affirming the decision favoring the respondent regarding the admissibility of Cenvat Credit on capital goods procured from M/s. Novartis Enterprises Ltd. in the Free Trade Zone, Kandla.