2017 (4) TMI 886 - AT - Central Excise

MODVAT credit - duty paying documents - credit of 6, 75, 658/- disallowed for wanting of original duty paying document - credit of 16, 72, 886.00 was disallowed on the ground that depot issued invoice is not registered - Held that - Since the original documents was not before the Ld. Commissioner(appeals) and proof of submission of documents before adjudicating authority was not produced by the appellant to the Commissioner(appeals - Commissioner(Appeals) has rightly remitted the matter to the original adjudicating authority for verification of the documents. As regard the modvat credit of 16, 72, 886.00 the duty paying characteristic is established receipt of input Is not under dispute and entire co-relation is established right from duty payment of the goods and receipt of the same goods in the factory of the appellant - credit allowed. Appeal allowed - part matter decided in favor of assessee and part matter on remand.

Summary

Issues involved:
1. Denial of modvat credit of ?6,75,658 for lack of original duty paying document.
2. Disallowance of modvat credit of ?16,72,886 due to the depot-issued invoice not being registered.

Analysis:

1. Issue 1 - Denial of modvat credit of ?6,75,658:
The appellant contested the denial of credit by the lower authorities, arguing that all original documents were submitted and accepted by the Commissioner(Appeals). However, the Commissioner remanded the matter for verification since the copy of the letter submitted along with documents was not produced. The Tribunal upheld the remand decision, stating that without proof of the submission of documents before the adjudicating authority, the Commissioner(Appeals) rightly directed verification of original documents. Thus, the matter was remitted to the original adjudicating authority for a fresh decision on the credit of ?6,75,658.

2. Issue 2 - Disallowance of modvat credit of ?16,72,886:
Regarding the disallowance of credit due to the unregistered depot-issued invoice, the appellant argued that although goods were received under such invoices, they were purchased from Reliance Industries Ltd under duty-paying invoices. The Tribunal found a clear correlation between the duty-paying documents, receipt of goods, and payment details in the ledger. Additionally, a certificate from the manufacturer and the depot's general ledger supported the duty payment. As a result, the Tribunal held that the credit of ?16,72,886 was admissible to the appellant, as the duty payment for the goods was established, and the receipt of inputs was undisputed. The appeal was disposed of in favor of the appellant, allowing the credit.

In conclusion, the Tribunal upheld the remand decision for the credit of ?6,75,658 and allowed the credit of ?16,72,886, emphasizing the importance of duty-paying documents and establishing a clear chain of evidence for credit eligibility.