2017 (8) TMI 351 - AT - Central Excise

CENVAT credit - duty paying invoices - denial of credit on the ground that the commercial invoices and purchase orders placed by the appellant, on the supplier company, mention pump sets, whereas the dealer s invoices on which credit availed by the appellant, shows only motors - Held that - nowhere it is brought on record that the appellant was not supplied with the motors which is part of the pump sets - mis-match between the commercial invoice and the excise invoice, as the later one relates only to motors, on which credit has been availed by the appellant, cannot be a ground for denying credit - appeal allowed - decided in favor of appellant.

Summary

Issues involved: Appeal against denial of CENVAT credit on imported Electric Motors due to mismatch between commercial invoices mentioning pump sets and dealer's invoices showing only motors.

Analysis:
1. Issue: Denial of CENVAT credit based on mismatch between commercial and dealer's invoices.

Analysis: The appellant availed CENVAT credit on motors of different Horse Powers, but the credit was denied due to discrepancies in the descriptions between the commercial invoices mentioning pump sets and the dealer's invoices showing only motors. The Ld. Commissioner (Appeals) upheld the denial based on this mismatch. However, the appellant argued that the commercial invoices were for pump sets as a whole, while the credit was claimed only on motors. The Tribunal found that the appellant had produced evidence of receipt and use of the capital goods in their factory, indicating that the denial of credit was unjustified. The mismatch between commercial and excise invoices, as the latter related only to motors, was not a valid ground for denying credit. The Tribunal also noted that the pumps were duly commissioned at the appellant's premises, further supporting the appellant's claim. As a result, the impugned order denying credit was set aside, and the appeal was allowed with consequential relief, if any, as per law.

2. Issue: Confirmation of demand for recovery of CENVAT credit with interest and penalty.

Analysis: The demand notice for recovery of CENVAT credit with interest and penalty was issued to the appellant based on the alleged non-receipt of the capital goods in their factory. The demand was confirmed with interest and penalty after adjudication. The appellant filed an appeal before the Ld. Commissioner (Appeals), who rejected their appeal. However, the Tribunal found that the appellant had provided evidence of receipt and use of the capital goods in their factory, which was not considered in the original decision. The Tribunal's decision to set aside the denial of credit also nullified the confirmation of demand with interest and penalty. The appellant's appeal was allowed, indicating that the demand notice was not valid in light of the evidence presented.

3. Issue: Interpretation of documents and correspondence between the appellant and the dealer.

Analysis: The Tribunal reviewed the correspondence between the appellant and the dealer, as well as the documents submitted as evidence. It was noted that the dealer's invoices did not bear the Serial Numbers of the pumps, which was a point of contention in the original decision. However, the Tribunal found that the appellant had availed CENVAT credit only on motors of different Horse Powers, not on the entire pump sets. The mismatch between the descriptions in the commercial and excise invoices was clarified as the commercial invoice covered pump sets, while the credit was specifically claimed on motors. This interpretation of documents and correspondence played a crucial role in overturning the denial of credit and confirming the receipt and use of the capital goods by the appellant.