2018 (5) TMI 1044 - AT - Central Excise

CENVAT credit - duty paying documents - whether appellant have received 6440 MTs of iron ore or not? - Held that - there is nothing to indicate that the appellant had short-received 6440 MTs of iron ore during the period nor there is any allegation in the show cause notice indicating that the appellant has to show cause for whether they received 6440 MTs of iron ore or not. Since in view of the fact that there is nothing on record to show that the appellant had received short-quantity of 6440MTs of iron ore pellets, the impugned order denying credit of ₹ 1,38,449/-is incorrect and the impugned order to that extent needs to be set aside - appeal allowed.

Summary

Issues involved:
Denial of CENVAT credit on iron ore pellets due to alleged moisture loss.

Detailed Analysis:

Issue 1: Denial of CENVAT credit
The appeal was filed against an Order-in-Original denying CENVAT credit of &8377;1,38,449 on iron ore pellets due to alleged moisture loss. The show cause notice raised concerns about the duty liability paid on provisional invoices from M/s Kudremukh Iron Ore Co Ltd. The adjudicating authority confirmed a demand of &8377;1,38,449 as inadmissible credit, citing that the inputs were not received in the factory premises.

Analysis:
Upon reviewing the show cause notice and order-in-original, it was noted that there was no evidence indicating that the appellant had short-received the 6440 MTs of iron ore pellets. The adjudicating authority's findings did not specify when or how the alleged shortage occurred. While the authority mentioned the appellant's acknowledgment of short-receipt in their response to the notice, the appellant contested this claim, asserting that they had indeed received the entire quantity of 42903 MTs of iron ore pellets as per the duty paying documents.

Decision:
Given the lack of evidence supporting the alleged short-quantity receipt, the Tribunal found the denial of credit unjustified and set aside the impugned order regarding the &8377;1,38,449 demand. Consequently, the question of interest and penalty did not arise. The appeal was allowed, and the cross-objection filed by the Revenue was also disposed of.

This detailed analysis of the judgment highlights the key issues, arguments, findings, and the ultimate decision made by the Tribunal regarding the denial of CENVAT credit on iron ore pellets.