1998 (4) TMI 257 - AT - Central Excise

Summary

Issues:
Modvat credit denial based on lack of original documents.

Analysis:
The appeal challenged the denial of Modvat credit by the Commissioner of Customs & Central Excise (Appeals) due to the unavailability of original documents. The Assistant Commissioner of Central Excise had initially denied the credit, stating that photocopies of the Bill of Entry and Proforma 'B' were produced instead of originals, with a note on the Triplicate copy stating "Not for availing Modvat credit." The Commissioner (Appeals) upheld this decision. The appellant argued that the original documents were submitted for defacement along with RT 12 returns and were lost, with evidence available on record. The appellant also cited legal precedents where Modvat credit was allowed based on endorsed photocopies when the authenticity was not in question.

The appellant further referenced decisions by the Hon'ble Bombay High Court and the Tribunal, emphasizing that Modvat credit could be granted even if the original documents were lost, provided the duty paid character of the inputs could be proven by other means. The appellant stressed that the photocopies of the Bill of Entry and Proforma 'B' in this case were authentic and not challenged. The appellant highlighted that the goods were raw materials/components, not consumer goods, reducing the risk of double credit being granted to another party.

After considering arguments from both sides and examining the case records, the judge found that the denial of Modvat credit solely due to the absence of original documents was unjustified. The judge noted that the appellant's explanation for the lost documents was plausible, especially considering the routine practice of sending documents for defacement. Additionally, there were no allegations of fraud or inauthenticity regarding the photocopies. Given that the imported products were raw materials/components and not consumer goods, the judge concluded that the possibility of double credit misuse was minimal, especially since the documents were in the appellant's favor. Relying on the legal precedents cited by the appellant, the judge ruled in favor of granting Modvat credit to the appellant, setting aside the previous orders and allowing the appeal.