2007 (3) TMI 115 - AT - Customs

Cenvat/Modvat credit - Department contended that since the imported goods are not goods on which Cenvat credit or Modvat credit can be taken the notification obviously does not cover imported good - Allow the department contention

Summary

Issues:
1. Disallowance of Modvat credit by adjudicating authority.
2. Appeal against Order-in-Appeal dated 26th February, 2004.
3. Availing Modvat credit based on certificate issued by supplier.
4. Lack of provision for allowing deemed credit on specific item.

Analysis:
The case involved an appeal filed against the Order-in-Appeal dated 26th February, 2004, regarding the disallowance of Modvat credit amounting to Rs. 2,03,823.90. The appellant had purchased M.S. Scrap/C.I. Scrap from M/s. Steel Authority of India Limited, Bhilai Steel Plant, and availed the credit based on documents indicating "duty paid goods" without specific duty amounts mentioned due to the goods being sold in lots. The adjudicating authority disallowed the credit, a decision upheld by the Commissioner (Appeals).

The appellant contended that they had produced a certificate from the supplier certifying the payment of excise duty, arguing that the department failed to provide evidence contradicting the certificate's validity. However, upon review, it was found that there was no provision for allowing deemed credit on the specific item in question as per the relevant Order. The appellant had admitted that the supplier did not mention the duty amounts paid on the inputs, leading them to avail the credit at the lowest duty rate. The Tribunal concurred with the Commissioner (Appeals) that the appellant could not substantiate the duty payment on the inputs, resulting in the dismissal of the appeal.

In conclusion, the Tribunal dismissed the appeal, emphasizing the lack of evidence supporting the payment of duty on the inputs and the absence of provisions for deemed credit on the item in question. The decision highlighted the importance of proper documentation and adherence to regulatory provisions in claiming Modvat credit, ultimately upholding the rulings of the lower authorities in disallowing the credit.