2015 (12) TMI 735 - AT - Central Excise

Denial of CENVAT Credit - credit on the xerox copy of the bill of entry - Held that - Case of the appellant is squarely covered by the law cited by the appellant 1997 (4) TMI 170 - CEGAT, NEW DELHI and 1998 (6) TMI 166 - CEGAT, NEW DELHI and I am of the considered opinion that the cenvat credit availed by the appellant on the strength of xerox copy of bill of entry is available to them as it is a settled law that a substantial benefit cannot be denied on the basis of technical violations, as I have seen in this case that the original bill of entry is with the Customs authorities and they have refused to return the same to the appellant. In such situation, the appellant is not at fault for not producing the same. On careful consideration of the submissions of both the sides, I am of the opinion that the impugned order is not sustainable in law and I set aside the same - Decided in favour of assessee.

Summary

Issues:
- Denial of cenvat credit on xerox copy of bill of entry
- Violation of Rule 9(1)(c) of Cenvat Credit Rules, 2004
- Principles of natural justice
- Appeal against order-in-appeal No. AGS (98)59/2010
- Validity of cenvat credit availed on photocopy of bill of entry

Analysis:
The appeal revolved around the denial of cenvat credit on a xerox copy of the bill of entry by the Commissioner of Central Excise & Customs. The appellant, engaged in manufacturing MS ingots, imported heavy metal scrap but faced issues with the Customs authorities retaining the original bill of entry. The appellant's efforts to obtain a certified copy failed, leading to a show cause notice for taking credit based on the xerox copy, resulting in penalties under Rule 14 and 15 of the Cenvat Credit Rules, 2004.

The appellant argued that the impugned order lacked reasoning and violated natural justice principles. They highlighted their attempts to obtain the original/duplicate copy of the bill of entry from Customs authorities, supported by TR-6 challan for duty payment. The appellant emphasized the duty paid character, usage of imported goods in manufacturing, and submission of end-use certificates. Additionally, they cited case laws to support their contentions.

On the other hand, the learned Assistant Commissioner argued against the validity of cenvat credit based on a xerox copy, citing relevant case laws. After considering both parties' submissions and the case laws presented, the Member (Judicial) found that the appellant's case aligned with the cited laws. The judgment emphasized that substantial benefits should not be denied due to technical violations, especially when the original bill of entry was withheld by Customs authorities despite the appellant's efforts to retrieve it.

Ultimately, the judgment set aside the impugned order, allowing the appeal and granting the appellant the cenvat credit on the xerox copy of the bill of entry. The decision highlighted the appellant's lack of fault in producing the original bill of entry due to Customs authorities' refusal, thus concluding that the denial of credit was not legally sustainable.