2017 (5) TMI 37 - AT - Central Excise

CENVAT credit - supplementary invoices - whether the appellant is entitled to avail Cenvat credit on supplementary invoices issued by Jalgaon and Pune units of the appellant at stock transfer, where allegation of suppression has not been proved by the Larger Bench of this Tribunal as well as the Mumbai Bench of the Tribunal in the case of Pune of the appellant? - Held that - the amortized cost is not required to be added in the value of the goods, in that circumstances, supplementary invoices is not required as the same has been issued and credit has been taken and that there is no suppression of facts by Pune unit - Cenvat credit cannot be denied to the appellant on amortized cost of capital goods in case of Pune as well as Jalgaon units. With regard to supplementary invoices issued by Jalgaon unit and the charge of under valuation, the Settlement Commission has not given any finding that there was suppression on the part of Jalgaon Unit and no penalty was imposed, in that circumstances, it can be presumed that charges of suppression is not proved. Therefore, in the absence of any suppression on the part of Jalgaon unit, Cenvat credit cannot be denied. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Entitlement to Cenvat credit on supplementary invoices issued by manufacturing units; Allegations of suppression of facts; Amortized cost of capital goods; Under valuation charges; Settlement Commission findings.

Entitlement to Cenvat credit on Supplementary Invoices:
The appellant appealed against an order alleging they were not entitled to avail Cenvat credit on supplementary invoices issued by their manufacturing units due to undervaluation of goods. The appellant stock transferred goods to their Gurgaon unit for assembly and clearance to Maruti Udyog Limited. The issue revolved around whether the appellant could claim Cenvat credit on these invoices. The Tribunal analyzed the Settlement Commission's findings and held that since no penalty was imposed and suppression of facts was not proven, the appellant was entitled to the credit.

Amortized Cost of Capital Goods:
Regarding the amortized cost of capital goods, the Tribunal referred to a previous order where it was held that such costs need not be added to the value of goods. Therefore, the Tribunal concluded that the appellant should not be denied Cenvat credit on the amortized cost of capital goods from both the Pune and Jalgaon units.

Under Valuation Charges and Settlement Commission Findings:
The Settlement Commission did not find any suppression of facts or impose penalties on the Jalgaon unit. Consequently, the Tribunal determined that without proven suppression, the appellant could not be denied Cenvat credit under the Cenvat Credit Rules. The Tribunal found no merit in the impugned order and allowed the appeal filed by the appellant with consequential relief.

This detailed analysis of the judgment highlights the key issues involved, the arguments presented by both parties, and the Tribunal's reasoning leading to the decision in favor of the appellant.