2015 (10) TMI 1669 - AT - Central Excise

Denial of CENVAT Credit - Imposition pf penalty - Held that - only ground to deny the Cenvat credit is that the description of the goods on the invoice issued by the first stage dealer does not match with the invoice/manufacturer but no investigation has been conducted at the end of first stage dealer/manufacturer of the goods. Moreover, it is not the allegation against the appellant that the appellant has not received the goods and has not paid duty thereon. In these circumstances, whatever duty has been paid by the appellant on the said goods, appellant is entitled to take Cenvat credit. Therefore, we hold that appellant has taken Cenvat credit correctly. Consequently, impugned order is set aside. - Decided in favour of assessee.

Summary

Issues:
Denial of Cenvat credit on M.S. Ingots due to mis-match of goods description on the invoice from the first stage dealer.

Analysis:
The appellant, a manufacturer of M.S. Ingots, faced denial of Cenvat credit amounting to &8377; 5,69,124/- along with interest and an equivalent penalty as per the impugned order. The dispute arose from the mismatch in the description of goods on the invoice issued by the first stage dealer compared to the manufacturer's invoice. The show cause notice dated 9-12-2004 alleged this mis-match, leading to the denial of credit upheld by both authorities.

The appellant contended that no investigation was conducted at the end of the dealer/manufacturer, and even though the dealer mentioned defective M.S. Ingots, the appellant received the goods and paid the duty. The appellant argued that since they filed regular returns showing Cenvat credit availment, the extended period of limitation should not apply. On the contrary, the Departmental Representative supported the findings of the impugned order.

After hearing both parties and considering the submissions, the Tribunal noted that the sole ground for denying Cenvat credit was the discrepancy in goods description on the dealer's invoice compared to the manufacturer's invoice. However, no investigation was carried out at the dealer/manufacturer's end. Importantly, there was no allegation that the appellant did not receive the goods or pay the duty. Therefore, the Tribunal held that the appellant correctly availed Cenvat credit and set aside the impugned order, allowing the appeal with any consequential relief.

In conclusion, the judgment revolved around the denial of Cenvat credit to the appellant due to a discrepancy in goods description on the invoices, emphasizing the lack of investigation at the dealer/manufacturer's end. The Tribunal ruled in favor of the appellant, stating that since there was no evidence of non-receipt of goods or non-payment of duty, the appellant was entitled to the Cenvat credit, ultimately overturning the impugned order and granting relief to the appellant.