2015 (9) TMI 1483 - AT - Central Excise

Denial of CENVAT credit - coal - N/N. 65.95-CE, dated 16.03.1995 - prior to 24.03.2011, no central excise duty was payable on coal produced in mine - whether the denial of CENVAT credit on the coal the ground that the inputs are not eligible, even though central excise duty has been paid on the same, justified? - Held that - It is an admitted fact that CENVAT credit has been taken by the appellant on the basis of the invoices issued by the supplier of coal, reflecting therein the excise duty charged and paid into the Govt. account. The supplier of goods was duly registered with the Central Excise Department and payment of duty on coal was not disputed by the excise authorities having jurisdiction over the factory of the respondent. Further, the classification of goods is the responsibility of the excise authority, having jurisdiction over the factory of the manufacturer or supplier. Thus, the assessment made at the supplier s end cannot be re-opened at the recipient s end, and therefore, credit taken by the respondent on the basis of valid and prescribed document, is in conformity with the CENVAT scheme. Further, receipt and utilisation of the disputed goods in the factory of the respondent has not been disputed by the original authority. Hence, in my considered view, taking of CENVAT credit of central excise duty, paid by the supplier, is in conformity with the statutory provisions - appeal dismissed - decided against Revenue.

Summary

Issues:
Appeal against denial of CENVAT credit for central excise duty paid on coal during a disputed period.

Analysis:
The appellant, engaged in manufacturing iron and steel products, availed CENVAT credit on central excise duty paid on coal during the disputed period. The Central Excise Department objected to this, stating that coal was exempt from duty before 24.03.2011 and any duty paid on it cannot be eligible for credit. The Show Cause Notice disallowed the credit and imposed a penalty, which was set aside by the Commissioner (Appeals). The Revenue appealed to the Tribunal.

During the period in question, the appellant availed CENVAT credit based on valid invoices from the supplier showing excise duty paid on coal. The supplier was registered with the Central Excise Department, and the duty payment was undisputed. The responsibility of goods classification lies with the excise authority at the supplier's end, and once the credit is taken based on valid documents, it aligns with the CENVAT scheme. The receipt and utilization of the goods by the appellant were not disputed. Therefore, the Tribunal found no issue with the Commissioner (Appeals) order and dismissed the Revenue's appeal.

In conclusion, the Tribunal upheld the Commissioner (Appeals) decision, emphasizing that the appellant's CENVAT credit on central excise duty paid on coal was valid as per statutory provisions. The judgment highlighted the importance of valid documentation and compliance with the CENVAT scheme in claiming such credits.