2017 (3) TMI 457 - AT - Central Excise

CENVAT credit - denial on the ground that no evidence was adduced before the Adjudicating Authority on behalf of the appellant to show that the subject goods were received in the factory and used in the manufacture of final product - Held that - substantial benefit of credit cannot be denied so long as it can be proved that the good are duty paid and received in the factory and are used in the manufacture of final product. These are all procedural and technical lapses, which are curable in nature. Accordingly, matter remitted to the Adjudicating Authority to verify the documents and decide the issue in accordance with law - appeal allowed by way of remand.

Summary

Issues:
1. Availment and utilization of CENVAT Credit based on invoices.
2. Alleged irregular availing and utilization of credit.
3. Rejection of appeal by Commissioner (Appeals).
4. Confirmation of demand, interest imposition, and penalty.
5. Evidence presented by the appellant.
6. Tribunal's decision and reliance on case law.
7. Revenue's submission and consideration of evidence.
8. Procedural and technical lapses.

Analysis:
1. The appellant filed an appeal against the rejection of the appeal by the Commissioner (Appeals) regarding the availment and utilization of CENVAT Credit amounting to ?54,144.97 based on 16 invoices from M/s Micro Inks. The appellant, a manufacturer of printing ink, was alleged to have irregularly taken and utilized the credit, leading to the demand confirmation, interest imposition, and penalty under relevant rules.

2. The appellant presented evidence, including Form of ER I, RG-23A Part II, Consignment Note, and declarations from M/s Micro Inks, indicating the correction of the appellant's address from 10 Phears Lane to 14E Bondel Road. The appellant also relied on a Tribunal decision in a similar case to support their position.

3. The Revenue argued that no evidence was provided to show receipt and usage of the goods in the manufacturing process. They contended that the allegations in the show-cause notice were not adequately addressed during adjudication, and new submissions before the Commissioner (Appeals) and the Tribunal should not be considered.

4. The Tribunal found that the denial of credit should be based on proof of duty payment, receipt in the factory, and usage in the final product's manufacture. Recognizing procedural and technical lapses, the matter was remitted to the Adjudicating Authority for verification and decision in accordance with the law, granting the appellant a reasonable opportunity to present their case.

5. The appeal was allowed by way of remand, keeping all issues open for further evidentiary support from both sides. The Tribunal's decision emphasized the importance of verifying documents and ensuring a fair hearing for the appellant in resolving the matter effectively.