2008 (9) TMI 677 - AT - Central Excise

Summary

Issues involved: Whether Cenvat credit can be denied due to shortage of inputs covered by invoices vis-a-vis weighment slips.

Summary:

Issue 1: Cenvat credit denial due to shortage of inputs

In the appeals of the Revenue, the main issue is whether Cenvat credit can be denied to the respondents for the disputed period based on a shortage of inputs as per invoices compared to weighment slips. The learned SDR cited decisions from the West Zonal Bench (Mumbai) like Bombay Dyeing & Mfg. Co. Pvt. Ltd. case and Mukund Ltd. case, where it was held that inputs not physically received in the factory were not eligible for Modvat credit. On the other hand, the counsel for the respondents relied on decisions from the Tribunal such as Neera Enterprises case, Commissioner of Central Excise & Customs, Aurangabad case, Mardia Chemicals Ltd. case, and Gharda Chemicals Ltd. cases, which held the opposite view. The conflict of decisions necessitates resolution by a Larger Bench, but the reference can only be made by the appropriate Division Bench, as directed by the Registry.