2018 (8) TMI 886 - AT - Central Excise

CENVAT Credit - extended period of limitation - it was alleged that the invoices although in the name of the appellant but delivery of the goods mentioned in the invoices has been done to Bansal Processing House - it was alleged that the appellant is not maintaining proper record of receipt of services on which they have taken Cenvat credit. Held that - The appellant has received the goods in their factory therefore merely mentioning on the invoices Delivery Bansal Processing House does not mean that the goods has been delivered to Bansal Processing House. In these circumstances Cenvat credit cannot be denied to the appellant - credit allowed. CENVAT Credit - Rule 9 (6) of the Cenvat Credit Rules 2004 - denial on the ground that the appellant is not maintaining proper record for availing of Cenvat credit - Held that - It is a fact on record that in Cenvat Credit Account the appellant has taken Cenvat credit on the strength of the invoices and there is no prescribed manner how to accounts records are to be maintained by the assessee - the appellant had established that they have taken Cenvat credit on the strength of invoices in their Cenvat credit account the same is sufficient evidencing that the appellant is maintaining proper accounts for availing of Cenvat credit - credit allowed. Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Denial of Cenvat credit for the period April 2006 to March 2008 due to delivery of goods to a third party.
2. Denial of Cenvat credit for not maintaining proper records of services received.

Analysis:
1. The appellant appealed against the denial of Cenvat credit amounting to Rs. 13,95,415 for the period April 2006 to March 2008. The denial was based on two grounds: (A) delivery of goods mentioned in the invoices to a third party, and (B) lack of proper record-keeping of services. The appellant argued that the goods mentioned in the disputed invoices were actually received by them, despite the delivery note stating "Delivery: Bansal Processing House." The appellant provided evidence that the supplier had a godown at the mentioned location and produced Form 26 of the VAT department confirming the receipt of goods in their factory. The tribunal held that the mere mention of delivery to a different location did not imply non-receipt by the appellant. Therefore, the denial of Cenvat credit on this ground was set aside.

2. Additionally, the Cenvat credit of Rs. 6,24,117 was sought to be denied under Rule 9(6) of the Cenvat Credit Rules, 2004, citing inadequate record-keeping by the appellant. However, the tribunal noted that the appellant had maintained Cenvat credit accounts based on invoices, and there were no specific prescribed methods for record-keeping. As the appellant demonstrated that they availed Cenvat credit based on invoices in their account, it was deemed sufficient evidence of maintaining proper accounts for availing Cenvat credit. Consequently, the denial of Cenvat credit on the grounds of inadequate record-keeping was overturned.

3. The tribunal found no merit in the impugned order and set it aside, allowing the appeal with any consequential relief. The judgment emphasized that the appellant had substantiated the receipt of goods and maintained adequate records for availing Cenvat credit, leading to the reversal of the denial on both grounds.

4. In conclusion, the tribunal ruled in favor of the appellant, overturning the denial of Cenvat credit for the specified period and amount, based on the evidence presented regarding the receipt of goods and the maintenance of proper accounts for availing Cenvat credit.