2008 (2) TMI 769 - AT - Central Excise

Cenvat/Modvat credit - Inputs lying in stock - Declaration - revised declaration - Held that - there is no dispute about the availability of input credits in respect of the goods, which stand denied only on the procedural aspects that instead of filing one declaration, multiple declarations have been filed by the appellant. There is no requirement under the law of filing only one declaration - appeal allowed.

Summary

Issues: Denial of Modvat credit for fabrics in stock due to multiple filing of declarations.

Analysis:
1. Denial of Modvat Credit: The appellant was denied Modvat credit in respect of fabrics in stock as on 31-3-03 to 1-4-03, as confirmed by the authorities below. The appellant filed multiple declarations regarding the stock, which was introduced to Modvat credit on 1-4-03. The dispute arose due to the insertion of sub-rule 5(b) in Rule 9A, extending the time for filing declarations. The appellant filed revised declarations on different dates after the introduction of the new rule.

2. Contention of the Revenue: The Revenue contended that the multiple filing of declarations by the appellant was not in accordance with the law. They argued that a single declaration should have been filed, specifying the description, quantity, and value of the stock of inputs on 1-4-03. The Revenue did not dispute the availability of input credits but emphasized the procedural error of multiple filings by the appellant.

3. Appellant's Defense: The appellant argued that the necessity for multiple filings arose due to the lack of information caused by an industry strike. They claimed they were unable to provide a consolidated declaration due to the unavailability of invoices and documents showing the value of goods and duty quantum. The appellant clarified that the goods were indeed present in the factory premises, and the only issue was the filing of multiple declarations instead of one consolidated declaration.

4. Judgment: After considering both sides, the judge found that the denial of credit was based solely on procedural grounds of multiple filings. The judge highlighted that there is no legal requirement mandating the filing of only one declaration. Therefore, the judge disagreed with the reasoning of the lower authority for denying the credit and set aside the impugned order, allowing the appeal in favor of the appellant.

This detailed analysis of the judgment addresses the issues of denial of Modvat credit for fabrics in stock due to multiple filing of declarations, highlighting the arguments presented by both parties and the ultimate decision of the judge in favor of the appellant.