2015 (10) TMI 1941 - AT - Central Excise

Denial of CENVAT Credit - only objection of the Revenue is that M/s. Suren Metal was registered at their Gurgaon address whereas they were dispatching the goods from their Vasant Kunj office - Held that - The inputs being sent by the registered dealer were under the cover of proper invoices, were duty paid and were actually received by M/s. Aravali and used by them in the manufacture of their final product. As such, merely because M/s. Suren Metal issued invoices and dispatched the goods directly from Vasant Kunj office, instead of doing so from their registered premises at Gurgaon cannot be held to be a ground for denial of credit to M/s. Aravali who actually received the inputs under the cover of proper invoices issued by Suren Metals. - Revenue during the course of investigation, recorded statement of various owners/drivers of the trucks as also of transport agencies. Though all of them deposed to the effect that they have actually loaded the goods from Vasant Kunj and delivered the same at Bahadurgarh factory of M/s. Aravali. One proprietor of M/s. Sharma Transport Service, Shri Ram Prakash Sharma denied such movement in respect of 5 invoices. For the balance invoices, he accepted the transportation of the goods from Vasant Kunj to Bahadurgarh. Shri Ramchander owner of the trucks involved, also denied having transported the goods - There is no other alternative source, shown by the Revenue for procurement of said inputs. As such, I find that the Revenue cannot build up its case on the oral submission of transporter, driver or owner of the truck without producing any other corroboratory evidence to substantiate the allegation. - No merit in impugned order - Decided in favour of assessee.

Summary

Issues:
1. Validity of sales invoices for passing on Cenvat credit.
2. Discrepancy in dispatch location of goods.
3. Denial of credit based on dispatch location.
4. Reliance on oral statements without corroborative evidence.

Analysis:
1. The judgment addresses the issue of the validity of sales invoices for passing on Cenvat credit. The case involves M/s. Aravali Infra Power Ltd., engaged in manufacturing aluminum ingots, procuring raw material from M/s. Suren Metals. The Revenue objected to the invoices issued by Suren Metals from their Vasant Kunj address instead of the registered Gurgaon address. The Tribunal found that despite the discrepancy in invoice addresses, the goods were dispatched and received by M/s. Aravali, leading to the conclusion that the denial of credit based on the location of invoice issuance was unjustified.

2. Another issue highlighted in the judgment is the discrepancy in the dispatch location of goods by M/s. Suren Metals. While the Revenue raised concerns about the dispatch from Vasant Kunj instead of the registered Gurgaon address, the Tribunal noted that the goods were indeed received by M/s. Aravali. The Tribunal emphasized that the actual receipt of goods and their lawful utilization by M/s. Aravali should take precedence over the dispatch location, especially when supported by proper invoices and duty payment.

3. The judgment also delves into the Revenue's denial of credit to M/s. Aravali based on the dispatch location discrepancy. The Tribunal agreed with the appellant's argument that the denial was unwarranted, considering the lawful receipt and utilization of inputs by M/s. Aravali. The Tribunal emphasized that the proper documentation and receipt of goods should be the primary consideration for allowing credit, rather than the technicality of dispatch location.

4. Lastly, the judgment scrutinizes the Revenue's reliance on oral statements without corroborative evidence. The Tribunal noted that during the investigation, statements from various individuals were recorded, but some discrepancies arose. The Tribunal highlighted that building a case solely on oral statements without additional evidence was insufficient. M/s. Aravali's proper documentation and utilization of inputs, coupled with the absence of alternative procurement sources shown by the Revenue, led the Tribunal to conclude that the case could not be substantiated based solely on oral submissions.

In conclusion, the Tribunal set aside the impugned orders, allowing all appeals with consequential relief to the appellants, emphasizing the importance of proper documentation, receipt, and utilization of goods in determining Cenvat credit eligibility.