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2021 (10) TMI 699 - AT - Central ExciseCENVAT Credit - availment of wrong cenvat credit of the same amount twice - returned goods - HELD THAT - The appellant have not taken wrong credit but rather have rectified the wrong debit made at the time of sales return, instead of taking credit, and accordingly the two entries of cenvat credit made by them on 31.12.2016 are in consonance and the accepted accounting principles. Hence, the impugned order is unsustainable and against the provisions of law. Appeal allowed - decided in favor of appellant.
Issues:
- Whether the appellant wrongly took cenvat credit twice for the same amount. Analysis: - The appellant was found to have availed and utilized cenvat credit of a certain amount twice in respect of returned goods from a specific entity during an audit. - The appellant clarified that they mistakenly debited the amount twice, first at the time of clearance of goods and second when the goods were returned, instead of re-crediting the cenvat account. - The appellant failed to provide documentary evidence during the audit to support the second debit entry but later submitted a computer-generated copy of SAP document showing the double debit. - A show cause notice was issued proposing to deny the credit and recover the amount along with interest and penalty for contravention of Cenvat Credit Rules. - The Adjudicating Authority disallowed the cenvat credit, ordered recovery with interest, and imposed a penalty under the Cenvat Credit Rules. - The appellant appealed to the Commissioner (Appeals) stating that they had rectified the mistake of double debit by passing subsequent entries to correct the error. - The Commissioner (Appeals) dismissed the appeal, upholding the Adjudicating Authority's decision. - The appellant then approached the Tribunal, demonstrating through their SAP accounting system that they rectified the error by passing entries to correct the double debit. - The Tribunal, after considering the arguments, found that the appellant rectified the wrong debit made at the time of sales return and did not wrongly take credit twice. The entries made by the appellant were in line with accepted accounting principles. - Consequently, the Tribunal allowed the appeal, set aside the impugned order, and granted consequential benefits in accordance with the law.
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