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2017 (5) TMI 943 - AT - Central ExciseCENVAT credit - duty paying invoices - finished goods returned back from the market - whether appellant is eligible to avail CENVAT credit of the amount of Central Excise duty on the goods returned back from C & F agent that also on the basis of photo copy of the triplicate copy of the invoices? - Held that - the appellant is not able to correlate actual quantity despatched and received back by them from C & F agent based upon the documents available - the ratio of the judgement of the Hon ble High Court of Gujarat in the case of Gujarat Setco Clutch Ltd. 2008 (9) TMI 623 - GUJARAT HIGH COURT is applicable in the case in hand - credit disallowed - appeal dismissed - decided against assessee.
Issues:
Eligibility to avail CENVAT credit on finished goods returned from the market based on triplicate copy of invoices. Analysis: The appeal challenged the order-in-appeal regarding the eligibility of CENVAT credit on finished goods returned from the market. Appellant received goods back from C & F Agents and claimed credit based on triplicate copy of their own invoices. Departmental officers disputed this, leading to a show-cause notice for demand of credit availed, interest, and penalties. Adjudicating authority and first appellate authority upheld the demands. The crux of the matter was the interpretation of Rule 16 of the Central Excise Rules, 2002, which the appellant argued was not applied correctly by the lower authorities. The appellant cited the Tribunal's decision in BAPL Industries Ltd. v. CCE Coimbatore to support their claim. The Departmental Representative (D.R.) supported the lower authorities' findings, citing the Tribunal's decisions in Akzo Nobel Coatings India Pvt. Ltd. and Mohit Industries Ltd., along with the judgment of the Hon'ble Gujarat High Court in Gujarat Setco Clutch Ltd. The issue at hand was whether the appellant could legitimately claim CENVAT credit on goods returned from C & F agents based on the triplicate copy of invoices. The first appellate authority's findings were crucial, emphasizing that the appellant failed to follow the procedures outlined in Rule 16 and relevant notifications. The authority highlighted the necessity for duty-paid goods to be accompanied by specific documents upon return to the factory. The appellant's failure to adhere to these requirements indicated a lack of compliance with established rules and regulations. The appellant's argument that Rule 16(3) was intended to assist manufacturers in availing credit was dismissed due to the appellant's non-compliance with the prescribed conditions. The Tribunal upheld the first appellate authority's findings, noting the appellant's inability to establish a correlation between goods dispatched and received back from C & F agents based on available documents. The Tribunal distinguished the case from BAPL Industries Ltd. by emphasizing the absence of a clear correlation in the appellant's situation. Ultimately, the Tribunal found no merit in the appeal, citing the precedent set by the judgment of the Hon'ble High Court of Gujarat in Gujarat Setco Clutch Ltd., which was upheld by the Apex Court. In conclusion, the Tribunal rejected the appeal, affirming the decision regarding the ineligibility of the appellant to claim CENVAT credit on goods returned from C & F agents based on the triplicate copy of invoices.
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