CESTAT, MUMBAI BENCH
Commissioner of Central Excise, Kolhapur
Shah Precicast (P.) Ltd.
FINAL ORDER NO. A/145 OF 2011-WZB/C-IV(SMB)
APPEAL NO. E/128 OF 2010
APRIL 5, 2011
1. Revenue is in appeal on the ground that xerox copy is not a proper document to avail CENVAT credit in terms of provisions of Rule 9(1)(c) of the CENVAT Credit Rules, 2004.
2. The facts of the case are that during the course of scrutiny of the records of the respondent it was found that the respondent has taken CENVAT credit on the strength of the xerox copy of the bill of entry which is not a proper document. Therefore, a show-cause notice was issued for wrong availment of CENVAT credit on the strength of xerox copy of bill of entry and for proposing penalty on the respondent for suppression of facts with an intention to evade duty. Same was adjudicated, demand was confirmed, penalty was imposed. Against that order, the respondent filed an appeal before the Commissioner (Appeals) who set aside the adjudication order and allowed the appeal of the respondent. Aggrieved from the said order, revenue is in appeal.
3. The ld. DR submitted that as per the provisions of Rule 9(1)(c) of the CENVAT Credit Rules, 2004, xerox copy is not a proper document to avail CENVAT credit. Therefore, impugned order is to be set aside.
4. On the other hand, the ld. advocate for the respondent reiterates the impugned order and submitted that as the original copy of the bill of entry was not available with them, they lodged a police compliant and undertook to produce as and when the original copy would be available with them. Further, they made efforts to obtain certified of the bill of entry from the office of the Commissioner of Customs, Goa who have denied their request. It is admitted that the goods have been received by the respondent, they have paid the duty on them and they have been used in the manufacture of the final product. Therefore, on the technical ground, credit should not be denied.
5. Heard and considered.
6. On careful examination of the submissions made both sides, the short issue involved in this case is whether the CENVAT credit availed by the respondent on the strength of the xerox copy of the bill of entry is available to them as per the provisions of Rule 9(1)(c) of the CENVAT Credit Rules, 2004. This issue has been dealt by the lower appellate authority in detail and in para 4 of the impugned order has observed as under :-
“I have gone through the case records including records of PH. After waiving pre-deposit, I take the main appeal itself for final decision. The lone issue to be decided in the present appeal is that whether the appellant can avail cenvat credit of Rs. 3,33,564/- on the strength of xerox copy of the bill of entry. The said cenvat credit was disallowed solely based under the provisions contained in rule 9(1)(c). That, as contended by the appellants, the said rule is silent, when all the valid documents are lost. However, proviso to sub-rule (2) of rule 9 gives power to the Deputy/Assistant Commissioner to allow the credit, if he is satisfied that the goods covered by the documents (in the instant case – bill of entry) have been received and accounted for in the books of the receiver (in the instant case – the appellant). As contended by the appellant, the adjudicating authority has not exercised this discretionary power available in the said rule. Besides, there was also no allegation that the appellant has not received the goods imported under bill of entry in question and not used in the manufacture of the final product. Under the above circumstances, it has to be concluded that the appellant has received the goods and utilised the same in the further manufacture. The appellant also claims that the duty was paid by the appellants only and there are documents to show that the goods have been received and used in further manufacture. But no attempt has been made by the department after disallowing the cenvat credit to the appellant. In this regard, the decision of the Hon’ble CESTAT in the case of CCE v. Vikrant Tyres [2005 STT 189 (CESTAT)] relied upon by the appellant fully supports the appellant. In the said case, it was held that the cenvat credit can be taken on the basis of certified copy of bill of entry, if receipt of goods and duty paid nature of the same is not in doubt. In yet another case, i.e. Bombay Goods Transport Association v. UOI [1995 (77) E.L.T. 521 (Bombay HC DB], it was held that modvat credit based on certified copy or authenticated copy cannot be mechanically disallowed. In this regard, the appellant has already approached before the Deputy Commissioner of Customs, Goa to get the certified copy of bill of entry which has been denied by him. Accordingly, I hold that since the duty paid nature, receipt and usage of the goods are not under dispute, the appellant is entitled to avail cenvat credit of Rs. 3,33,564/-. There are catena of decisions wherein it has been consistently held that the substantial benefit cannot be denied on the basis of ‘technical’ violation. In the instant case, the issue involved is a ‘technical’ violation i.e. cenvat credit was not taken on the strength of bill of entry but on the basis of xerox copy of bill of entry.”
7. After going through the observation made by the lower appellate authority I do agree with the observation that substantial benefit cannot be denied on the basis of mere technical violation. In this case, the respondents have made effort to obtain certified copy of the bill of entry which was also denied to them. Further it is not disputed that the goods have not suffered duty and they have not been used in the manufacture of final product. Therefore, the respondents are entitled for CENVAT credit availed by them on the strength of xerox copy. Accordingly, I do not find any infirmity with the impugned order and the same is upheld. Appeal filed by the Revenue is rejected.