TMI Blog2024 (1) TMI 1117X X X X Extracts X X X X X X X X Extracts X X X X ..... VERSUS COMMISSIONER OF C. EX., KANPUR [ 2000 (1) TMI 74 - CEGAT, NEW DELHI] where it was held that The very object of issuance of Notification No. 32/94 referred to above and insertion of Rules 57GG and 174 requiring the registration of the dealer dealing with the excisable goods, would stand defeated and nullified if these are taken to be only procedural and not mandatory/ imperative in character and enforcement. Distinguishing, the said LB decision of the Tribunal, the Hon. High Court in the case of MARMAGOA STEEL LTD. VERSUS UNION OF INDIA [ 2005 (4) TMI 89 - HIGH COURT OF JUDICATURE AT BOMBAY] , while recording its findings had held that In the absence of any provision regarding endorsement on the bill of entry, the credit of duty cannot be denied on the ground that the bill of entry is not endorsed in the name of the claimant. As stated hereinabove, what is required to be established for taking credit of duty is that the goods used as inputs are duty paid and that the credit of duty paid on the said goods has not been taken. As long as various ingredients regarding duty paid character of the goods are clearly established and there is no dispute about their utilizati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the Show Cause Notice thereby allowing the Cenvat Credit availed by the noticee. The appellant had received sponge iron from M/s N. E. Thermion (P) Ltd. Duliajan on the basis of endorsed invoices issued to M/s. N. E. Thermion (P) Ltd., by the manufacturers of the sponge iron. The Department therefore alleged that the goods in the said invoices were diverted to the noticee. Likewise availment of credit in respect of certain capital goods like C. I. Ingot moulds received from M.s N. E. Thermion (P) Ltd. (who in turn had received them from the manufacturers), on the basis of endorsed invoices were also disputed by the Revenue. As the Revenue in pursuance of their case relied upon Rule 9 (1) (a) of the Cenvat Credit Rules, 2004 the same is reproduced hereunder for sake of ready reference: Rule 9. Documents and Accounts.- (i) The CENVAT credit shall be taken by the manufacturer or the provider of output service or input service distributor, as the case may be, on the basis of any of the following documents, namely:- (i) A manufacturer for clearance of- I. Inputs or capital goods from his factory or depot or from the premises of the consignment agent of the said manufac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of course no mention about the endorsed invoices. However, it is clearly mentioned that Cenvat Credit shall be taken by the manufacturer on the basis of an invoice issued by a manufacturer for clearance of input or capital goods from his factory or depot or from the premises of the consignment agent of the said manufacturer or from any other premises from where the goods are sold by or on behalf of the said manufacturer [Ref. Rule 9(1) of the Cenvat Credit Rules, 2004]. Moreover, a manufacturer of final products shall be allowed to take cenvat credit paid on any input or capital goods received in the manufacture of final product. It is also found that there is no dispute regarding the receipt of input by the noticee in allegation made in the instant Show Cause Notice where it is simply mentioned that the noticee received raw material (Sponge Iron) from M/s N. E. Thermion (P) Ltd., Duliajan and endorsed by them. There is no mention regarding date of receipt of inputs, date issue of invoces, whether directly received by the noticee from the manufacturer though invoices, whether directly received by the noticee from the manufacturer though invoices were issued in the name of M/s. N. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Coatings Pvt. Ltd. [2016 (337) E.L.T. 515 (Guj.), held that Cenvat Credit on endorsed invoices was not permissible and the view taken by the Learned Adjudicating Authority was liable to be set aside. 5. The decision of the Hon ble Gujarat High Court referred in Para 4, was based on the decision of the Larger Bench of Tribunal in the case of Balmer Lawrie Co. Ltd. Vs. CCE, Kanpur[2000 (116) ELT 364 (Tri.)] and it was held that after issuance of Notification dated 04/07/1994, invoices can only be issued by a registered dealer alone. Notification No. 32/94 dated 04/07/1994 reads as:- Modvat Credit- Invoice of registered dealer acceptable In exercise of the powers conferred by rule 57G of the Central Excise Rules, 1944 and in supersession of notification of the Government of India in the Ministry of Finance, Department of Revenue No. 15/94-C.E (N.T.), dated the 30th March, 1994, the Central Government hereby prescribes the invoice issued by (i) a manufacturer from the factory or his depot or (ii) dealer of an excisable goods registered with the Central Excise Officer; or (iii) an importer from his godown, or (iv) dealer of an imported goods re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Commissioner (Appeals) clearly indicated that it was not imperative for the intermediary purchaser to have issued a separate invoice, when even the material has not actually reached the godowns to the first purchaser and who has sold to the subsequent purchaser. The seller, in such circumstances can only issue an invoice of the goods in transit and endorse the invoice issued by manufacturer to enable the buyer in transit to take delivery of goods covered under invoice. The presentation of his invoice would also satisfy the requirement of Rule 57G. In fact, the requirement was to produce the gate pass and the invoice issued by the manufacturer evidencing payment of duty on such input as proof of payment of duty on such inputs can be covered by the gate pass issued by the manufacturer or the invoice issued by the manufacturer himself. The endorsement put on it does not take away its value as evidence of payment of duty on such goods. 8. The Bombay High Court in the case of Marmagoa Steel Ltd. Vs. Union of India 2005 (192) ELT 82 (Bom) had held that input credit was not deniable to assessee endorsed in the name of the person claiming the credit. This case law was however in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g invoices under Rule 57GG, for claiming Modvat credit, was never intended to make compulsory or mandatory, but only fell within the area of procedure which could even be deviated or violated by the dealer if it was shown by the end user of the goods that the same were intended to be used or had been actually used, in relation to the manufacture of the final product and were duty paid. The words used in Rules 57GG and 174 referred to above are that the dealer of the excisable goods shall get himself registered. Both these rules are thus mandatory in nature, being based on consideration of Policy enacted with a view to eliminate bogus, fictitious, fraudulent, benami traders/dealers and the transactions conducted by them from the commercial market and to avoid misuse of the Modvat scheme not only by them but by the persons deriving title to the goods through them and further to bring transparency in the transactions. These rules being of substantive character and built in with certain objectives cannot, therefore, be called merely a procedural, the deviation of which can be permitted to be made by the dealer of the excisable goods with immunity. The very object of issuance of Notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... try is one such document set out in Rule 57G. The said rule does not require that the bill of entry should be in the name of the person claiming credit of duty. It is not in dispute that the goods imported and cleared on payment of duty by one person can be used as inputs and credit of duty can be claimed by another person by establishing that the imported duty paid goods have been received as inputs and that the importer has not taken credit of that duty. In the present case, it is established that the duty paid goods are received as inputs, however, the credit is denied on the ground that the Bill of entry is not endorsed in the name of the appellant. Rule 57G does not require that for taking credit of duty, the bill of entry should be endorsed in the name of the claimant. Counsel for the revenue could point out any provision of law in the Act or the Rules regarding the endorsement of bills of entry . In the absence of any provision regarding endorsement on the bill of entry, the credit of duty cannot be denied on the ground that the bill of entry is not endorsed in the name of the claimant . As stated hereinabove, what is required to be established for taking credit of duty is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovision in the statute that holds that credit on endorsed invoices, in situations where the goods are duly received is not available to the third party. 11. Further, respectfully bowing before the decision of the LB of the Tribunal, in the case of Balmer Lawrie Co. Ltd. [2000 (116) ELT 364(T)] as well as their Lordship in the case of Marigold Coatings Pvt. Ltd. [(2016 (337) ELT 515 (Guj.)], it is to submit that the said decisions do not pertain to a case of Rule 9 of the Cenvat Credit Rules, 2004 and were decided in the context of the old provisions. The ratio of the said law laid down therefore cannot be applied to decide the issue in altogether distinct circumstances and under new provisions of law. The only requirement in law for availment of credit is an invoice, that is issued by a manufacturer, for clearance of inputs or capital goods , from may be any other premises where the goods are sold . , and further what the law mandates is the indication of all particulars as are prescribed under the Central Excise Rules, in the said invoice. There is no dispute about any of the ingredients supra, not being met with in the instant case. For said reasons, the case of K ..... X X X X Extracts X X X X X X X X Extracts X X X X
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