Case Law Details
Brief Facts of the case:
The main appellant M/s. Shah Paper Mills Limited (assessee co.) the manufacturer of kraft paper from waste paper among other items. The assessee company claimed Cenvat credit with respect to duty paid Rs. 12,19,605/- on the waste kraft paper received from M/s. Shah Pulp and Paper Mills Limited(supplier).
Adjudicating authority vide OIO dated 26.4.2011 disallowed CENVAT credit of Rs. 12,19,605/- to the main appellant(assessee co.) M/s. Shah Paper Mills Limited (Unit-3), Vapi and confirmed the demand along with interest. Equivalent penalty of Rs. 12,19,605/- was also imposed by the Adjudicating authority upon the main appellant and a penalty of Rs. 4,00,000/- was imposed upon the other appellant Shri Hemant G. Modi, Director of the main appellant, under Rule 15(1) of the Cenvat Credit Rules. It was adjudicating authority view that that segregation of imported scrap does not amount to manufacture hence no excise duty was required to be charged by the supplier M/s. Shah Pulp and Paper Mills Limited. Thus, the assessee company had claimed credit of excise duty which was not even leviable on purchase. Aggrieved by the order of adjudicating authority, assessee company and its director jointly filed an appeal before CESTAT.
Contention of the Assessee:
The learned counsel for the assessee contended that credit cannot be denied if at the time of taking credit when duty paid nature of the inputs was established. He also contended that for any improper duty paid by the supplier without appellant’s knowledge, the appellant cannot be denied CENVAT credit and extended period cannot be invoked in the present proceeding as the appellant had paid duty and claimed credit in boanfide belief and there is nothing on the record which show that appellant was aware of the irregular duty levied by the supplier.
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Author Bio
Respected Sir,
I have one query :-
We are having Data Management Software System in which we scans our Invoices and makes payment to our service provider.
Do we requires to avail CENVAT only on the basis of Hard copy in Invoices or Scanned Invoices stored on our DMS software from where one can view it is sufficient.
This query is raised because we have different projects & Offices in different states and remote areas and we are getting many invoices in our centrally registered office later 4 – 5 months due to which we are not able to avail CENVAT in time to adjust AGAINST our SERVICE TAX LIABILITY, RESULT IN HEAVY CASH OUTFLOW AS SERVICE TAX LIABILITY.
Thanks & Regards,
Tejas Vora
+91-750 634 2352