2025 (7) TMI 1133 - AT - Central Excise

Entitlement to CENVAT Credit to job-worker - availment of credit on the strength of bill of entry which is in the name of principal which bears declaration for the appellant to take the cenvat credit - HELD THAT - The matter stands covered in the case of CGST vs Ravi Pharmaceuticals Private Limited 2024 (9) TMI 1775 - CESTAT AHMEDABAD where it was held that The bill of entry is indeed a duty paying document since the appellant have used the material the bill of entry have been endorsed in their name and on that basis they have availed the Cenvat credit. - It is found that there is identical situation as the imported raw materials have been supplied to the job worker (appellant in this case) who has availed cenvat credit on the relevant bills of entries clearly incorporating declaration from the principal. Credit stands allowed - The appeal of Revenue is dismissed.

Summary

ISSUES:

• Whether a job worker is entitled to avail Cenvat credit on the strength of Bills of Entry in the name of the principal with a declaration allowing the job worker to take credit.
• Whether endorsement of Bills of Entry in the name of the job worker is mandatory for availing Cenvat credit under Rule 9 of the Cenvat Credit Rules, 2004.
• Whether procedural or technical lapses in documentation can justify disallowance of Cenvat credit and imposition of penalty under Section 11AC of the Central Excise Act, 1944.

RULINGS / HOLDINGS:

• The Court held that a job worker is entitled to avail Cenvat credit on imported inputs received under Bills of Entry in the name of the principal, accompanied by a declaration permitting the job worker to take credit, as the goods are received and used in manufacture of dutiable goods.
• The Court found that Rule 9 of the Cenvat Credit Rules, 2004 does not mandate endorsement of Bills of Entry in the name of the job worker, especially since endorsement by Customs Officer has been discontinued; a separate certificate or declaration issued by the principal is to be considered part of the Bill of Entry for the purpose of availing credit.
• The Court ruled that no Cenvat credit can be disallowed nor penalty imposed merely on account of technical or procedural lapses in documentation, provided the imported goods are duty paid, received, and used in manufacture of excisable goods.

RATIONALE:

• The Court applied Rule 9 of the Cenvat Credit Rules, 2004, which lists documents on the basis of which Cenvat credit can be availed, including Bills of Entry, and requires prescribed particulars to be contained therein.
• The Court relied on judicial precedents including a High Court judgment holding that a separate certificate/declaration issued instead of endorsement of Bill of Entry is to be considered part of the Bill of Entry for credit purposes, and that credit cannot be denied if duty has been paid and goods have been used in manufacture.
• Subsequent Supreme Court dismissal of departmental appeals against such judgments was noted, indicating acceptance of this legal position by the department.
• Other authoritative decisions were cited confirming that Cenvat credit is admissible even if Bills of Entry are not in the name of the manufacturer but goods are received and used in manufacture.
• The Court emphasized that procedural compliance is important but cannot override the substantive fact that imported inputs were duty paid and used in manufacture, thus rejecting attempts to deny credit or impose penalties solely on technical grounds.