2014 (3) TMI 632 - AT - Central Excise

Denial of CENVAT Credit - Credit denied on the ground that photocopy is not a valid duty paying document - as per the provision of Rule 9 (c) a manufacturer can avail credit on the basis of the bill of entry. In the present case, the applicant were having the photocopy of bill of entry which shows the goods are imported by M/s Panoli Intermediates (India) Pvt. Ltd. and it has been mentioned that the document transferred in favour of the appellant. The bill of entry was provisionally assessed as per the photocopy on record. If the bill of entry was provisionally assessed there must be final assessment in respect of goods imported by M/s Panoli Intermediates (India) Pvt. Ltd. Applicant had not produced any order finalising the assessment in respect of imported goods. In respect of limitation, I find that applicant had not disclosed to the Revenue in the monthly return that the credit has been availed on the basis of photocopy of bill of entry. as applicant has not produced the bill of entry or the order finalising the assessment and has taken credit only on the strength of photocopy which is provisionally assessed - No infirmity in order - Decided against assessee.

Issues involved:
- Availing credit based on a photocopy of bill of entry
- Validity of photocopy as a duty paying document
- Interpretation of Rule 9 of the Cenvat Credit Rules
- Requirement of final assessment for imported goods
- Disclosure obligations in monthly returns

Availing credit based on a photocopy of bill of entry:
The appellant availed credit of Rs. 48,985 based on a photocopy of a bill of entry dated 26.02.2004. The credit was contested by the revenue on the grounds that a photocopy is not a valid duty paying document. The appellant argued that they initially had the original bill of entry in 2004 but lost it subsequently. They claimed that efforts were made to locate the original bill and that the credit was taken solely based on the photocopy due to the unavailability of the original.

Validity of photocopy as a duty paying document:
The revenue, relying on Rule 9 of the Cenvat Credit Rules, contended that only a valid duty paying document, not a photocopy, can be used to avail credit. The Tribunal noted that Rule 9 (c) allows a manufacturer to avail credit based on the bill of entry. In this case, the appellant possessed a photocopy indicating the goods were imported by a specific entity and transferred to them. However, the Tribunal emphasized the absence of a final assessment order regarding the imported goods and highlighted the provisional assessment based on the photocopy.

Interpretation of Rule 9 of the Cenvat Credit Rules:
The Tribunal analyzed Rule 9 (c) which specifies the requirements for availing credit based on the bill of entry. It noted that the appellant failed to produce the original bill of entry or an order finalizing the assessment of the imported goods. Moreover, the appellant did not disclose in their monthly returns to the Revenue that the credit was based on a photocopy of the bill of entry. Consequently, the Tribunal found no merit in the appellant's argument and upheld the denial of credit based on the photocopy.

Requirement of final assessment for imported goods:
The Tribunal stressed the importance of final assessment in cases of imported goods. It pointed out that without a finalized assessment order, the provisional assessment based on the photocopy of the bill of entry lacks validity. The absence of documentation confirming the assessment status of the imported goods contributed to the dismissal of the appeal.

Disclosure obligations in monthly returns:
Another critical aspect considered by the Tribunal was the appellant's failure to disclose in their monthly returns to the Revenue that the credit was availed based on a photocopy of the bill of entry. This lack of disclosure raised concerns about transparency and compliance with reporting requirements, further weakening the appellant's position in seeking credit based on the photocopy.

In conclusion, the Tribunal dismissed the appeal as the appellant could not provide the original bill of entry or a finalized assessment order for the imported goods, and failed to disclose the basis of credit availed in their monthly returns. The judgment underscores the significance of adhering to documentation requirements, especially in cases involving duty payments and credit availing processes under the Cenvat Credit Rules.

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