2000 (10) TMI 117 - AT - Central Excise

Summary

Issues: Disallowance of Modvat credit on invoices from specific depots of M/s. Bharat Petroleum Corporation Ltd. - Non-compliance with prescribed conditions - Denial upheld by lower authorities - Appeal against Commissioner (Appeals) order.

The judgment pertains to the disallowance of Modvat credit totaling Rs. 8,84,518/- on invoices from Shakur Basti and Mathura depots of M/s. Bharat Petroleum Corporation Ltd. The Assistant Commissioner of Central Excise disallowed the credit citing non-fulfillment of conditions prescribed in various notifications. The Commissioner (Appeals) confirmed this disallowance, stating that the items were not directly used in the manufacture of the final product and lacked necessary particulars on documents for Modvat credit availment. The appeal challenges this decision, arguing that LDO and RFO were used in generating electricity and steam, which were essential for the manufacturing process. The appellant contended that the Modvat credit should not be denied based on technicalities related to invoice particulars, especially since the original authority had already accepted the credit on merit. The appellant further argued that the depots of M/s. Bharat Petroleum Corporation were not required to be registered as dealers with the Central Excise authorities and that the duty payment details were adequately reflected in the invoices from the depots. The Tribunal accepted the appellant's submissions, ruling in their favor and overturning the lower authorities' disallowance of Modvat credit on the disputed items.

In summary, the judgment revolves around the denial of Modvat credit on specific invoices from M/s. Bharat Petroleum Corporation Ltd. depots due to non-compliance with prescribed conditions and lack of necessary particulars. The appellant successfully argued that the items in question were integral to the manufacturing process, despite not being directly used in the final product. The Tribunal agreed with the appellant's contention that technical discrepancies in invoice particulars should not invalidate the credit, especially when the duty payment details were accurately reflected. Ultimately, the Tribunal allowed the appeal, setting aside the orders of the lower authorities and granting the appellant the right to avail Modvat credit on the disputed items.