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2010 (4) TMI 957 - AT - Central Excise
Issues involved: Appeal against the impugned order allowing Modvat credit based on provisionally assessed bill of entry.
Issue 1: Verification of final assessment of bills of entry The matter was before the Tribunal for the second round of litigation. The Tribunal had earlier remanded the matter to the Commissioner with a direction to ascertain whether the bills of entry had been finalized before deciding on the admissibility of credit. The Revenue contended that the Commissioner failed to verify the final assessment of the bills of entry and instead allowed Modvat credit based on provisional assessment. The Tribunal noted that there was no provision under the Cenvat Credit or Modvat Credit Rules to deny credit solely on the basis of provisional assessment. The Tribunal found no fault on the part of the Commissioner for not verifying the final assessment of the bills of entry, especially considering the long delay by the Revenue in conducting such verification. Issue 2: Denial of credit on endorsed bills of entry The Tribunal had observed that denial of Modvat credit solely on the ground of bills of entry being provisionally assessed and final assessment not being produced even after five years cannot be a prima facie ground for denial. The Commissioner was directed to consider whether denial of credit on endorsed bills of entry was correct and to ascertain if final assessment had been completed. The Revenue contended that the Commissioner did not properly verify the endorsed bills of entry. However, the Tribunal found that the Commissioner had appropriately relied on Tribunal decisions and rejected the Revenue's appeal, stating that no interference was warranted in this regard. In conclusion, the Tribunal upheld the Commissioner's decision to allow Modvat credit based on provisionally assessed bill of entry and rejected the Revenue's appeal. The Tribunal emphasized the lack of grounds for denying credit solely on the basis of provisional assessment and noted the absence of any provision in the relevant rules to support such denial.
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