2016 (1) TMI 1010 - AT - Central Excise

Denial of CENVAT credit - appellant submits that there is no dispute that the appellant received the inputs and recorded in RG23A Pt. I register within 6 months as provided under Rule 57 G of the erstwhile Central Excise Rules, 1944 and therefore, there is no reason to deny the CENVAT credit - Held that - There is no dispute that the appellant received the inputs in their factory in the month of May 1999 and recorded in RG23A Pt.-I register. Rule 57G of erstwhile Rules, 1944 provides credit cannot be taken by the manufacture after 6 months of the date of issue of any documents supplied in Sub Rule 3 of the said Rules. The Tribunal in the case of Commissioner of Central Excise, Hyderabad vs Aurobindo Pharma Ltd. (2000 (10) TMI 93 - CEGAT, CHENNAI) held that time limit of 6 months from the date of issue of duty paying document applied to receipt of goods in the factory and not to the process of taking the credit. - Decided in favour of assessee

Summary

Issues:
1. Denial of CENVAT credit for the period August 1999 to February 2000.
2. Interpretation of Rule 57G of the erstwhile Central Excise Rules regarding the time limit for taking credit.
3. Applicability of previous tribunal and high court decisions on similar issues.

Analysis:
1. The case involved the denial of CENVAT credit amounting to Rs. 21,17,996.31 for the period August 1999 to February 2000. The appellants, engaged in manufacturing Reduction Gears and Parts thereof, received inputs from M/s Tisco in May 1999 but faced delays in availing the credit due to rectification issues with the invoices sent to M/s Tisco. The adjudicating authority confirmed the demand, which was upheld by the Commissioner (Appeals).

2. The key issue revolved around the interpretation of Rule 57G of the erstwhile Central Excise Rules, 1944, which stipulates a time limit of 6 months from the date of issue of any duty paying documents for taking credit. The appellant argued that the time limit applied to the receipt of goods in the factory and not to the process of taking credit, citing tribunal decisions and the case of Aurobindo Pharma Ltd. The Tribunal, in the appellant's earlier case, allowed the appeal based on the Aurobindo Pharma Ltd. decision, which was upheld by the Hon'ble Gujarat High Court.

3. The Revenue contended that corrections in the record regarding credit in RG23A Pt.II were relevant, referring to the decision in the case of Panjon Limited and the Hon'ble Supreme Court case of M/s Osram Surya (P) Ltd. However, the Tribunal, after considering arguments from both sides and previous decisions, concluded that the appellant's receipt of goods within the stipulated time frame allowed for availing the credit, setting aside the impugned order and allowing the appeal.

Overall, the judgment emphasized the importance of timely receipt of goods for availing CENVAT credit, aligning with previous tribunal and high court decisions on similar issues. The ruling provided clarity on the interpretation of Rule 57G and upheld the appellant's right to claim the credit within the specified timeframe.