2008 (9) TMI 330 - AT - Central Excise

Cenvat - the credit to the appellants cannot be denied on the basis of the fact that M/s. Indian Oil at the material time did not issue pre-authenticated invoices and did not mark the invoices as duplicate for transporter - the appellants are entitled for Modvat Credit

Summary

Issues:
1. Disallowance of Modvat credit on oil and grease due to missing duplicate copy of the invoice.
2. Denial of Modvat credit on furnace oil for electricity generation and supply due to various grounds such as non-authenticated invoices and missing "duplicate for transporter" marking.

Analysis:
1. The first issue involves the disallowance of Modvat credit on oil and grease amounting to Rs. 2,55,783/- due to the absence of the duplicate copy of the invoice. The appellant, a public sector unit, received goods under rubber stamped invoices marked as "DUPLICATE FOR TRANSPORTER." The Tribunal considered the actual transportation of goods under such invoices and the certification obtained from the supplier public sector undertaking. Citing precedent, the Tribunal held that rubber stamped invoices are valid for obtaining credit. Consequently, the credit was allowed, considering the circumstances and the verification provided.

2. The second issue concerns the denial of Modvat credit on furnace oil totaling Rs. 4,17,07,268/- for electricity generation and supply. The appellant, another public sector unit, received goods directly from M/s. Indian Oil under several invoices. The denial was based on grounds like the use of furnace oil for electricity supply to the township, non-pre-authenticated invoices, and missing "duplicate for transporter" marking. The Tribunal noted the appellant's proportionate calculation for electricity usage and the reversal of credit based on a reasonable basis. Additionally, the non-pre-authenticated invoices and missing marking were addressed by citing relevant tribunal decisions. Ultimately, the Tribunal held that the appellants were entitled to Modvat credit on the furnace oil, except for the proportionate amount reversed for electricity supplied to the township.

In conclusion, the Tribunal set aside the impugned order, allowing the appeals on both issues and overturning the penalty imposed on the public sector appellants.