2000 (2) TMI 122 - AT - Central Excise

Summary

Issues Involved:
1. Whether the original copy of the invoice issued u/r 52A could be an enabling document for taking Modvat credit in terms of Rule 57G.
2. Whether the requirement of producing a particular copy of the invoice is procedural or mandatory.
3. The validity of Modvat credit claims based on original invoices without the duplicate copy.
4. The implications of the loss of the duplicate copy of the invoice in transit.

Summary:

Issue 1: Original Copy of Invoice as Enabling Document
The primary issue was whether the original copy of the invoice issued u/r 52A could be used for taking Modvat credit in terms of Rule 57G. The Tribunal examined conflicting judgments, noting that in Mahavir Spinning Mills Ltd. v. Commissioner of Central Excise, Chandigarh, it was held that credit could be taken on the basis of the original copy of the invoice even before the amendment by Notification No. 23/94-C.E. (N.T.). Conversely, in Nestle India Ltd. v. Collector of Central Excise, Chandigarh, it was held that no credit could be taken on the original copy of the invoice.

Issue 2: Procedural vs. Mandatory Requirement
The Tribunal determined that the requirement to produce the duplicate copy of the invoice is mandatory, not merely procedural. Rule 57G(2A) allows credit on the original invoice only if the duplicate is lost in transit, subject to the satisfaction of the Assistant Collector. This provision underscores the mandatory nature of producing the duplicate copy unless specific conditions are met.

Issue 3: Validity of Modvat Credit Claims
The Tribunal reviewed several appeals where manufacturers claimed Modvat credit based on the original invoice without the duplicate copy:
- In E/410/98-NB, the manufacturer's claim was upheld as they informed about the loss of the duplicate copy.
- In E/411/98-NB, the claim was denied as the manufacturer used a photocopy of the original invoice without seeking permission for the loss of the duplicate.
- In E/412/98-NB, the claim was denied as the manufacturer did not seek permission for the loss of the duplicate copy.
- In E/413/98-NB, the claim was denied as the manufacturer could not substantiate the loss of the duplicate copy.
- In E/414/98-NB, the claim was denied as the manufacturer did not seek permission for the loss of the duplicate copy.
- In E/415/98-NB, the claim was denied as the manufacturer did not seek permission for the loss of the duplicate copy.
- In E/468/98-NB, the claim was denied as the manufacturer did not seek permission for the loss of the duplicate copy.

Issue 4: Loss of Duplicate Copy in Transit
The Tribunal clarified that the term "lost in transit" refers to the period from the seller to the jurisdictional excise officer. If the duplicate copy is lost during this transit, the manufacturer must satisfy the Assistant Collector to avail credit on the original invoice. The Tribunal emphasized that the rule should not be interpreted to add conditions not explicitly stated.

Conclusion:
The Tribunal concluded that the requirement to produce the duplicate copy of the invoice is mandatory. Credit can only be taken on the original invoice if the duplicate is lost in transit and the Assistant Collector is satisfied with the explanation. The Tribunal upheld or reversed the decisions of the Commissioner (Appeals) based on whether the manufacturers complied with these requirements.