2018 (3) TMI 1419 - AT - Central Excise

CENVAT credit - delay of one day in filing the statement - the sole ground to deny self credit to the appellants by the Commissioner (Appeals) is that condition of para 2C(d) of the N/N. 56/2002-CE is required to be complied strictly - Held that - a similar issue came up before this Tribunal recently in the case of Saraswati Agro Chemicals India Ltd. 2018 (3) TMI 263 - CESTAT CHANDIGARH , wherein this Tribunal examined the Notification No.01/2010-CE dt. 06.02.2010 and related conditions in para 5(d), 5(e) and 5(f) and held that condition 5(d) of the Notification No.01/2010-CE dt. 06.02.2010 is procedural in nature and for complying with the said condition with a delay cannot be fatal to the appellants. Condition 2C(d) is procedural in nature and for compliance with the said notification, delay of one day cannot be fatal to the appellant and the self credit taken by the appellants cannot be denied. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against denial of self-credit under Notification No.56/2002-CE for late filing of statement.

Analysis:
The appellants, manufacturers of drugs and pharmaceuticals, appealed against the denial of self-credit due to late filing of a statement required under Notification No.56/2002-CE. The appellants availed Cenvat credit benefits under para 2C(a) of the notification, which mandated filing the statement by the 15th day of the subsequent month. The appellants filed the statement for June 2015 on 16.07.2015, one day late, leading to a show cause notice challenging their self-credit. The Commissioner (Appeals) disallowed the self-credit, citing non-compliance with the notification's condition. The appellants contested this decision, leading to the present appeal.

The Tribunal considered the case in light of a recent judgment involving a similar matter under Notification No.01/2002-CE. The Tribunal had previously ruled that a procedural lapse, such as late filing of the statement, should not result in denying the benefit of the notification to the appellants. The conditions specified in the notification, including timely submission of statements, were examined to determine the appellants' entitlement to self-credit. The Tribunal highlighted the importance of procedural compliance but emphasized that a minor delay should not be fatal to the appellants' claim for self-credit.

Drawing parallels with a previous case under Notification No.01/2010-CE, the Tribunal reiterated that the conditions regarding statement submission were procedural in nature. The Tribunal clarified that a delay of one day in complying with such conditions should not lead to the denial of self-credit. The judgment emphasized that the conditions were designed to facilitate self-credit for eligible assesses and that strict compliance with procedural aspects should not overshadow the substantive entitlement of the appellants.

Based on the precedent and the nature of the conditions specified in the notification, the Tribunal concluded that the delay of one day in filing the statement should not be considered fatal to the appellants' claim for self-credit. The Tribunal found no merit in the Commissioner (Appeals)'s decision to disallow the self-credit and set aside the impugned order. Consequently, the appeal filed by the appellants was allowed, affirming their right to avail the self-credit under Notification No.56/2002-CE.

In conclusion, the Tribunal's judgment underscored the importance of procedural compliance while recognizing that minor lapses should not deprive eligible assesses of their entitlements under relevant notifications. The decision provided clarity on the interpretation of conditions related to self-credit under the notification, ensuring a fair balance between procedural requirements and substantive benefits for the appellants.