2016 (11) TMI 771 - AT - Central Excise

CENVAT credit - recovery - documents on which the credit availed were irregular - Held that - I find that the documents/evidences enclosed with the paper book on which CENVAT Credit is denied, do not inspire confidence about its genuineness, in particular, the figures entered in hand However, it also cannot be out rightly rejected that premiums have not been paid nor suffered service tax as mentioned against these documents. In my view, all these facts need to be verified with collateral/corroborative evidences. Therefore, in the circumstances, it is prudent to remand the matter to the Adjudicating authority to ascertain the correctness of these documents and entries made therein with other corroborative evidences that would be produced by the Appellant during the course of proceedings, while determining the eligibility of CENVAT Credit on such input services. All issues are kept open. Needless to mention that a reasonable opportunity of hearing be extended to the Appellant before passing the order - Appeal allowed by way of remand.

Summary

Issues: Admissibility of CENVAT Credit on input services; Genuineness of documents supporting credit availed.

Admissibility of CENVAT Credit on input services:
The appeal challenged the Order-in-Original (OIA) confirming the demand for recovery of CENVAT Credit amounting to ?3,34,218 availed on input services like Insurance and Banking during January 2009 to February 2010. The Appellant contended that all necessary particulars for availing the credit were available on the documents submitted. The Appellant's Advocate argued that the premium paid for insurance and service tax were clearly mentioned in the respective premium receipts and bank invoices, making the confirmation of the demand incorrect. On the other hand, the Authorized Representative for the Revenue raised doubts about the genuineness of the documents, specifically pointing out that the insurance premium was mentioned on the insurance company's letterhead, not on a valid invoice. The Revenue argued that without corroborative evidence to clarify the payment of insurance premium and service tax, the CENVAT credit was rightly held inadmissible.

Genuineness of documents supporting credit availed:
The Tribunal, after hearing both sides, noted that the documents submitted by the Appellant did not inspire confidence regarding their genuineness, particularly due to hand-entered figures. However, the Tribunal acknowledged that it could not outrightly reject the possibility of the premiums not being paid or service tax not being applicable. The Tribunal deemed it necessary to verify the accuracy of the documents and entries with collateral evidence. Therefore, the matter was remanded to the Adjudicating authority for further investigation to determine the eligibility of CENVAT Credit on the input services. The Tribunal emphasized the need for the Appellant to provide additional corroborative evidence during the proceedings. The Tribunal allowed the appeal by remanding the case to the Adjudicating authority, keeping all issues open and ensuring a reasonable opportunity of hearing for the Appellant before a new order is passed.