2001 (2) TMI 382 - AT - Central Excise

Summary

Issues:
Whether Modvat credit was eligible based on invoices not in prescribed colour code.

Analysis:
The appeal involved the eligibility of M/s. Siddharath Petro Products for Modvat credit on duty paid inputs received under invoices not in the prescribed pink colour. The Assistant Commissioner disallowed the credit, upheld by the Commissioner (Appeal) citing procedural lapses. The appellant argued that despite the colour code requirement effective from 1-8-1995, credit should not be denied for inputs received in August and September 1995. Reference was made to judgments allowing credit despite technical lapses if no fraud was suspected. The appellant relied on cases like CCE v. Chaddha Pvt. Ltd. and Nizam Tubes Ltd. where credit was allowed for the transitional period.

The Respondent contended that Notification No. 23/95 required invoices to be in pink colour from 1-8-1995, allowing a two-month transition period. Referring to the Avis Electronics case, it was argued that compliance with prescribed rules for duty-paying documents was not a technicality. The Respondent distinguished the Chaddha Papers case, emphasizing the importance of the prescribed colour scheme. The Respondent also highlighted that the appellant's reliance on Timber Products case was misplaced as it involved a different scenario.

Upon review, the Tribunal found that the law mandated specific requirements for duty-paying documents, emphasizing adherence to the prescribed manner. The Tribunal noted that the appellant failed to use pink colour invoices during the transition period despite having printed computerized invoices. Rejecting the argument of a transitional phase, the Tribunal held that individual dealers could not selectively implement the colour scheme after the provided transition period. The Tribunal found no fault in the impugned order as the invoices did not comply with the prescribed colour code, leading to the rejection of the appeal.

In conclusion, the Tribunal upheld the decision to disallow Modvat credit due to non-compliance with the prescribed colour scheme for invoices, emphasizing the importance of adherence to legal requirements for availing such credits.