1998 (12) TMI 180 - AT - Central Excise

Summary

Issues:
Denial of Modvat credit due to non-compliance with Notification 23/95, dated 30-5-1995.

Analysis:
The appellant, engaged in the manufacture of various products, availed Modvat credit under Central Excise Rules, including industrial furnace oil as an input. The denial of Modvat credit was based on non-compliance with Notification 23/95, dated 30-5-1995, regarding incomplete invoice details. The Assistant Commissioner confirmed the demand, upheld by the Commissioner (Appeals), leading to the present appeal.

The Assistant Commissioner found that the invoices did not meet the requirements of Rule 57GG of Central Excise Rules, 1944, and Notification 23/95, dated 30-5-1995. The missing details included essential information like time of issue, Central Excise Registration No., assessable value, and duty amount. Non-compliance with these mandatory provisions rendered the invoices invalid for Modvat credit, as per statutory requirements. The Assistant Commissioner relied on a previous CEGAT decision for support.

The appellate authority agreed with the Assistant Commissioner, emphasizing the importance of complete invoice details to prevent misuse and ensure proper verification of input utilization. While acknowledging the rectification of defects in the invoices, the authority highlighted the necessity of full compliance with the law. However, the appellant argued that the inputs were received and used in manufacturing, and the technical lapses in the invoices were remediable. Citing relevant case laws, the appellant contended that genuine documents and rectifiable defects should not lead to denial of Modvat credit.

Ultimately, the appellate authority sided with the appellant, noting that the inputs were indeed utilized in the final product, and the procedural lapses in the invoices were corrected. Emphasizing the beneficial nature of the Modvat scheme, the authority allowed the appeals, setting aside the previous orders and granting consequential relief as permissible by law. The decision highlighted the importance of genuine documents and the utilization of inputs in manufacturing processes, ultimately leading to the allowance of Modvat credit in the given circumstances.