2019 (7) TMI 1648 - AT - Central Excise

CENVAT Credit - duty paying documents - contravention of Rule 9 of Cenvat Credit Rules 2004 - HELD THAT - The name of Indian Oil Corporation Ltd. Servo Lube Depot is mentioned in the invoice. Further the appellants had purchased the goods from the registered dealer and there is no dispute that the goods had been purchased by the dealer from M/s. Indian Oil Corporation Ltd. When the goods had been indisputably purchased from M/s. Indian Oil Corporation Ltd. by the registered dealer and having supplied the same to the appellant and the appellant had received the goods in their factory and used them in the manufacture of the final products the question of denial of Cenvat Credit cannot arise. It is not the case of the Department s that the invoice is not genuine or the Central Excise Duty has not been paid. Under the circumstances when the goods have suffered duty and the goods have been received by the appellant in their factory from the registered dealer and have not used in the manufacture of the final products the benefit of Cenvat Credit cannot be denied. Appeal allowed - decided in favor of appellant.

Summary

Issues: Alleged irregular Cenvat Credit availment in contravention of Rule 9 of Cenvat Credit Rules, 2004.

In this case, a Show Cause Notice was issued alleging irregular Cenvat Credit availment of Rs. 13,100 in violation of Rule 9 of Cenvat Credit Rules, 2004, due to an invoice issued by a First Stage Dealer that did not conform to necessary provisions. The Adjudicating Authority ordered recovery of the credit with interest and imposed a penalty. The Lower Appellate Authority upheld this decision, leading to an appeal before the Tribunal.

The Appellant argued that the goods were purchased from a registered dealer who, in turn, bought them from Indian Oil Corporation Ltd., a government undertaking. The Tribunal found that the goods were purchased from a registered dealer who sourced them from Indian Oil Corporation Ltd. The Tribunal noted that the goods were received by the Appellant and used in manufacturing final products, with no dispute on the payment of Central Excise Duty. The Tribunal referenced a previous decision to support its ruling.

The Tribunal acknowledged that the capital goods were supplied by a registered dealer, and the Appellant was not required to verify the dealer's compliance with the law. It emphasized that the responsibility lies with the manufacturer to discharge duty liability. If the original manufacturer pays the duty subsequently, the Appellant is entitled to credit, and no penalty can be imposed. Consequently, the Tribunal set aside the impugned order, allowing the appeal with consequential relief for the Appellant.

The Tribunal concluded that the facts of the case aligned with the previous decision, leading to the setting aside of the impugned order and allowing the appeal with consequential relief.