2016 (9) TMI 532 - AT - Central Excise

Cenvat credit - import of capital goods against the Target Plus Scheme and whole of the duty payable on such import was debited from the Duty Credit Certificate issued under Notification No. 32/2005-Cus dated 8.4.2005 - non-submission of installation certificate from the jurisdictional Central Excise authority which is a need under notification on time - import was made by M/s. Nahar Exports Ltd. instead of appellant - Held that - in the absence of any reference to the condition in the Cenvat Credit Rules, 2004, there is no justification for the view taken by the lower authorities. Further, admittedly, during the course of adjudication itself the appellant submitted attested copy of the certificate dated 22.9.2008 issued by the jurisdictional Deputy Commissioner wherein the use of capital goods so imported has been satisfied. We find that there is no justification in denying the credit to the appellant for the reason quoted by the lower authorities. The capital goods have suffered duty, have been used in the appellant s premises and have been duly installed and used by the appellant. Regarding import document bearing name of M/s.Nahar Export Ltd., we find that the appellant s name did figure in many documents alongwith M/s.Nahar Export Ltd., who is proprietor of the appellant. Even in respect of the document where the appellant s name figuring, it is settled position of law that as long as the capital goods have used, the duty payment has been satisfied and are to be put to intended use, the credit on the same cannot be denied. It is found that the appellant is manufacturing unit of M/s.Nahar Export Ltd. who are absolute owner of the appellant s firm as proprietor. It is also clear that in all the bills of entry the appellant s name alonwith their proprietor M/s.Nahar Export Ltd. is indicated. The goods were actually exported by M/s.Nahar Export Ltd. and in lieu of such export, they were granted certificate under Target Plus Scheme. That various statutory authority like Central Excise, DGFT, the appellant are considered alongwith M/s.Nahar Export Ltd. as the same entity.Therefore, in the absence of any allegation regarding non receipt of capital goods and the appellant s non entitlement of any other ground, the credit on these capital goods received and installed in the appellant s premises cannot be denied. - Decided in favour of appellant

Summary

Issues:
Denial of cenvat credit on capital goods imported under the Target Plus Scheme due to failure to submit an installation certificate and import documents showing a different importer.

Analysis:

Issue 1: Installation Certificate Requirement
The appellant's cenvat credit on capital goods was denied based on the requirement in Notification No. 32/2005-Cus dated 8.4.2005, stating that an installation certificate must be submitted within six months of import. However, the Tribunal found that this condition was not referenced in the Cenvat Credit Rules, 2004. The appellant later submitted an attested certificate from the jurisdictional Deputy Commissioner confirming the use of the imported capital goods in the appellant's premises. The Tribunal concluded that since the capital goods had been used, installed, and duty paid, there was no justification for denying the credit based on the installation certificate requirement.

Issue 2: Import Documents Showing Different Importer
The second ground for denying the cenvat credit was that the import documents listed M/s. Nahar Exports Ltd. as the importer, not the appellant. However, the Tribunal noted that the appellant's name was also present in various documents alongside M/s. Nahar Exports Ltd., who was the proprietor of the appellant. The Tribunal emphasized that as long as the capital goods were used, duty paid, and intended for use, the credit could not be denied. It was established that the appellant was a manufacturing unit of M/s. Nahar Exports Ltd., and both entities were considered the same for various statutory purposes. Since there were no allegations of non-receipt of goods or other disqualifying factors, the Tribunal held that the credit on the capital goods installed in the appellant's premises could not be denied.

Conclusion:
The Tribunal set aside the impugned order and allowed the appeal, ruling in favor of the appellant. The denial of cenvat credit on the imported capital goods under the Target Plus Scheme was deemed unjustified, as the goods had been used, duty paid, and installed in the appellant's premises, meeting the necessary requirements for availing the credit.