2016 (6) TMI 714 - AT - Central Excise

Availment of cenvat credit on improper invoices - Held that - Duty paid character of the goods covered under the disputed invoices, their receipt and utilization in the factory of manufacture of the final product, are not in dispute. Since, the inputs have suffered duty and used in the factory of the appellant for the intended purpose, non-mention of mode of transport etc. in the invoices cannot be the defensible ground for denial of cenvat benefit in terms of the Second Proviso to Rule 9 of the Cenvat Credit Rules. Therefore, do not find any merits in the impugned order, and thus, the same is set aside and the appeal is allowed in favour of the appellant. - Decided in favour of assessee

Summary

Issues: Availment of cenvat credit on improper invoices

In this judgment, the issue at hand is the availment of cenvat credit on invoices lacking details such as mode of transport and vehicle registration numbers. The appellant had availed cenvat credit on various inputs during the disputed period based on invoices that did not contain these specific details. The Adjudicating Authority disallowed the cenvat credit, a decision upheld by the Ld. Commissioner (Appeals) citing Rule 9 of the Cenvat Credit Rules, 2004 read with Rule 11(2) of the Central Excise Rules, 2002. The appeal was brought before the Tribunal challenging this decision.

The Tribunal, after hearing arguments from both sides and examining the records, found that the denial of cenvat credit was solely based on the absence of mode of transport and vehicle registration numbers on the invoices. However, it was noted that the duty paid character of the goods covered by the invoices, their receipt, and utilization in the factory for manufacturing final products were not in dispute. Given that the inputs had indeed suffered duty and were used for the intended purpose in the appellant's factory, the Tribunal concluded that the lack of details like mode of transport on the invoices should not be a valid reason to deny cenvat benefit. The Tribunal referred to the Second Proviso to Rule 9 of the Cenvat Credit Rules in support of this decision. Consequently, the Tribunal set aside the impugned order disallowing the cenvat credit and allowed the appeal in favor of the appellant.

This judgment highlights the importance of the actual utilization of inputs for manufacturing purposes and the duty paid on the goods, rather than solely focusing on technical deficiencies in the invoices like missing details of mode of transport. The decision provides clarity on the eligibility criteria for availing cenvat credit and emphasizes the substantive compliance with the rules over procedural shortcomings in documentation.