2017 (8) TMI 885 - AT - Central Excise

CENVAT credit - denial of credit in respect of invoices wherein the address is wrongly mentioned - Held that - the denial of Cenvat credit merely on wrong address mentioned by oversight is not justified when the same has also been clarified by the supplier by issuing the letter which is placed on record. It is a settled law that Cenvat credit should not be denied on mere technicalities - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund denial based on wrongly mentioned address on invoices.

Analysis:
The appellant, engaged in manufacturing fabricated steel machinery parts, availed Cenvat credit on inputs, capital goods, and input services. During an audit, objections were raised regarding irregular Cenvat credit availed. The appellant paid the disputed amount but later filed a refund claim. The Asstt. Commissioner issued a show cause notice proposing to reject the refund claim. The Commissioner (A) partly allowed the appeal but denied the Cenvat credit of ?38,448 based on invoices with incorrect addresses. The appellant challenged this denial in the present appeal.

The appellant's counsel argued that the denial of refund based on the wrong address mentioned on the invoices was unjust and not sustainable. They clarified that the inputs received under the questioned invoice were accounted for and used in manufacturing finished goods. The discrepancy in the door number was attributed to a clerical error, promptly rectified upon discovery. The supplier acknowledged the mistake in a letter. The appellant maintained that the amount was paid, accounted for, and thus, Cenvat credit should not be denied due to a minor clerical mistake.

The AR reiterated the findings of the impugned order, upholding the denial of Cenvat credit based on the incorrect address mentioned on the invoices. However, upon considering both parties' submissions and reviewing the records, the Member (J) opined that denying Cenvat credit solely due to an oversight in the address was unjustified. The clarification provided by the supplier through a letter, acknowledging the clerical error, was crucial. The Member (J) emphasized that Cenvat credit should not be denied on mere technicalities. Consequently, the impugned order's denial of Cenvat credit was deemed unsustainable in law. The appeal was allowed, and any consequential relief was granted.

The operative portion of the order was pronounced in open court on 26-12-2016.