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2017 (7) TMI 473 - AT - Central ExciseCENVAT credit - M/s Motherson Sumi Systems Ltd.(MSSL), was engaged in the manufacture of Wiring Harness falling under Chapter 85.44 of the Central Excise Tariff Act, 1985. PVC Tape is one of the inputs of M/s MSSL, and is an output product of the other appellant M/s NPIL. Further M/s NPIL is one of the suppliers of PVC Tape to M/s MSSL - Revenue is of the view that M/s NPIL was engaged in illegal availment of Cenvat Credit on CP 172 Resin which is one of their major inputs and have diverted their input and/or major part of the input - whether the appellant- M/s Motherson Sumi Systems Ltd. have received the inputs namely; PVC Filler/Tape, from their supplier, Nataraj Plast industries Ltd. and accordingly, whether the Authorities below are justified in denying the CENVAT credit of ₹ 37,26,151.68/- along with equal amount of penalty imposed on MSSL with further penalty on Shri Rakesh Kumar Sharma & Nataraj Plast Industries Ltd., for the period September, 2004 to October, 2005? Held that: - Revenue have not found any error in the records of M/s MSSL regarding receipt of the goods from M/s NPIL, the proper account and payment for the same and utilization of the PVC Tapes in the production of wiring harness which have been cleared on payment of duty - Revenue have drawn adverse inference based on some minor variation and or clerical error, in about 8 invoices out of total of 91 invoices, in the disputed period, which is also in respect, only vehicle nos. as mentioned in the invoices and as compared with the manual register of vehicles entering the factory maintained at the gate by the security staff. Such gate register is not by the management of M/s MSSL, and as such no reliance can be placed on the same for drawing adverse inferences - credit allowed - appeal allowed - decided in favor of appellant.
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