2016 (3) TMI 805 - AT - Central Excise

Eligibility of CENVAT CREDIT - whether the courier bill of entry is a proper document for availing Cenvat Credit under the CENVAT Credit Rules, 2004? - whether the entire demand is time barred or not? - Held that - Since these appellants have been disclosing in their regular return filed by them that they have been availing Cenvat Credit on courier bill of entry and the department has also conducted the audit from time to time of the records of the appellant and has never raised the objection of availing the Cenvat Credit on the basis of courier bill of entry and further, the respondent has not been able to bring on record any material which shows that there is a wilful misstatement or suppression of facts or contravention of any of the provisions of the Act or the Rules with intent to evade payment of duty. In view of this, the entire demand is time barred and the appellant is entitled to avail Cenvat Credit on the basis of courier bill of entry as relying on Tecumseh Products India P. Ltd. 2007 (3) TMI 170 - CESTAT, BANGALORE and Controls & Drives Coimbatore P. Ltd. 2007 (11) TMI 57 - CESTAT CHENNAI as per the Bill of Entry Regulation, 1976, courier bill of entry is a valid document for clearance of any imported goods and this is so provided as per Regulation 5(3) proviso of Courier Imports and Exports Clearance Regulation 1988. - Decided in favour of assessee

Summary

Issues involved:
1. Denial of Cenvat Credit on courier bill of entry.
2. Time limitation for the demand.

Analysis:

Issue 1: Denial of Cenvat Credit on courier bill of entry
The case involved the appellant, engaged in manufacturing excisable goods, availing Cenvat Credit under the CENVAT Credit Rules, 2004. The dispute arose when a show-cause notice was issued demanding Cenvat Credit repayment of a specific amount. The appellant contested the notice, arguing that the payment of duty on inputs was made and utilized, justifying the credit. The appellant's counsel emphasized that denying Cenvat Credit on technical grounds was unjust as it is a beneficial provision. Additionally, the appellant argued that a courier bill of entry should be considered a valid document under Rule 9(1) of the CENVAT Credit Rules, as it contains essential details required for availing credit. The appellant also raised the issue of time limitation, stating that the demand period was time-barred since the notice was issued after a significant delay. The appellant highlighted that despite regular disclosures and audits, no objection was previously raised by the department regarding availing Cenvat Credit on courier bill of entry.

Issue 2: Time limitation for the demand
The respondent, however, relied on circulars and past decisions to support the denial of Cenvat Credit on courier bill of entry. The appellate tribunal considered the arguments from both parties. The tribunal noted that the two key issues to decide were the validity of availing Cenvat Credit based on the courier bill of entry and whether the demand was within the time limitation. The tribunal agreed with the appellant's contentions, emphasizing that the appellant had consistently disclosed the credit availed and that the department had not shown any wilful misstatement or suppression of facts. Consequently, the tribunal held that the entire demand was time-barred, allowing the appeal and granting relief to the appellant.

In conclusion, the appellate tribunal ruled in favor of the appellant, setting aside the impugned order and allowing the appellant to avail Cenvat Credit on the basis of the courier bill of entry. The tribunal found the demand to be time-barred, providing consequential relief to the appellant.