2000 (8) TMI 351 - AT - Central Excise

Summary

Issues:
- Denial of eligibility to Modvat credit by the Commissioner of Central Excise, Pune based on handwritten or typewritten serial numbers, and invoices marked original or duplicate by handwriting or rubber stamp.

Analysis:
1. The learned Advocate for the appellant argued that the denial of Modvat credit based on procedural requirements was unjustified as there was no allegation or finding that duty had not been paid on the goods in question. The amendment to rule 57G in 1999 stated that credit cannot be denied solely for missing particulars, as long as duty payment is confirmed, which was not disputed in these cases.

2. The departmental representative argued that rule 57GG mandated printed serial numbers on invoices, citing previous Tribunal decisions. The concern was that without printed serial numbers, credit could be taken multiple times on invoices with the same number, potentially leading to misuse.

3. Various Tribunal decisions were referenced, such as Nahar Spinning Mills Ltd. v. CCE and CCE v. Herbicides (I) Ltd., emphasizing substantial compliance with the law rather than technical violations for granting Modvat credit. It was highlighted that denial of credit on technical grounds when substantive conditions are met is not justified.

4. The Tribunal noted conflicting views on the requirement of printed serial numbers in rule 57GG, with some decisions supporting it as a statutory necessity and others emphasizing substantial compliance. The Tribunal observed that strict adherence to rule 57GG was not practical in actual practice, as acknowledged by the departmental representative.

5. The Tribunal highlighted that rule 57GG allowed for invoices generated through computers without printed serial numbers, indicating flexibility in compliance. The essential requirement for credit was ensuring duty payment on inputs used in manufacturing finished products, with other requirements being of secondary importance.

6. Sub-rule 11 of rule 57G introduced an amendment stating that credit should not be denied for missing particulars if duty payment and use of inputs in manufacturing were confirmed. The Tribunal found that concerns about misuse of the scheme were addressed by this amendment, maintaining that denial of credit should not be based solely on technicalities.

7. Ultimately, the Tribunal concluded that denial of credit based on handwritten or typewritten serial numbers, or invoices marked by handwriting or rubber stamp, was not justified. The Commissioner's order denying credit on these grounds was set aside, clarifying that only these specific issues were under consideration.

This detailed analysis of the judgment from the Appellate Tribunal CEGAT, Mumbai provides a comprehensive overview of the issues involved and the arguments presented by both parties, leading to the Tribunal's decision regarding the eligibility of Modvat credit based on procedural requirements and the necessity of printed serial numbers on invoices.