Khandesh Pipe Products Vs. Commissioner of Central Excise - Court Judgment

Excerpt:
1. the appeal is against the order of the commissioner (appeals) confirming the denial of modvat credit taken by the appellant of the duty should have been paid on some invoice, on the ground that the invoices did not bear any endorsement as to whether they were original, duplicate or triplicate.3. the contention in the appeal is that it is settled law that modvat credit cannot be denied on procedure failure, if there has been substantive compliance. the decision of the single member of the tribunal in nahar spinning mills ltd v. cce 1998 (97) elt 127 is also relied upon.4. i do not think that the requirement of invoices being marked in a particular manner, coupled with the fact that requirement as the credit is normally to be taken on the basis of duplicate copy of invoice, is a simple technical procedure which can be waived. this procedure exists to enable the departmental officers to ensure that: misuse of the facility does not take place and for them to verify credit has been taken only of the duty paid. in the decision cited by the appellant, the tribunal, after seeing of the invoices in question remanded the matter to verify the contention of the assessee that it was only duplicate copy which did not specifically say that it was duplicate copy. although it is not spelt out, inference is clear that the claim was that the other copies were marked "original" "triplicate" etc. in the case before me, the commissioner (appeals) has noted that none of the invoices had any marking at all. the ratio of this decision therefore will not apply. on the facts of this case, i am of the view that the appellant is able to establish that the credit is taken only on one copy and no credit has been taken on the other copies of invoices and each copy of the invoices have been duly accounted for satisfactorily, the credit should be allowed. it was the appellant's failure to mark the document. in that situation, ii is for the appellant therefore to satisfy the adjudicating authority in this regard.the matter is therefore remanded to the adjudicating authority, who will consider the submissions of the appellant in this regard and the evidence that may be produced before him, within two months from the receipt of this order and thereafter pass orders in accordance with law.

Judgment:
1. The appeal is against the order of the Commissioner (Appeals) confirming the denial of modvat credit taken by the appellant of the duty should have been paid on some invoice, on the ground that the invoices did not bear any endorsement as to whether they were original, duplicate or triplicate.

3. The contention in the appeal is that it is settled law that modvat credit cannot be denied on procedure failure, if there has been substantive compliance. The decision of the single member of the Tribunal in Nahar Spinning Mills Ltd v. CCE 1998 (97) ELT 127 is also relied upon.

4. I do not think that the requirement of invoices being marked in a particular manner, coupled with the fact that requirement as the credit is normally to be taken on the basis of duplicate copy of invoice, is a simple technical procedure which can be waived. This procedure exists to enable the departmental officers to ensure that: misuse of the facility does not take place and for them to verify credit has been taken only of the duty paid. In the decision cited by the appellant, the Tribunal, after seeing of the invoices in question remanded the matter to verify the contention of the assessee that it was only duplicate copy which did not specifically say that it was duplicate copy. Although it is not spelt out, inference is clear that the claim was that the other copies were marked "original" "triplicate" etc. In the case before me, the Commissioner (Appeals) has noted that none of the invoices had any marking at all. The ratio of this decision therefore will not apply. On the facts of this case, I am of the view that the appellant is able to establish that the credit is taken only on one copy and no credit has been taken on the other copies of invoices and each copy of the invoices have been duly accounted for satisfactorily, the credit should be allowed. It was the appellant's failure to mark the document. In that situation, ii is for the appellant therefore to satisfy the adjudicating authority in this regard.

The matter is therefore remanded to the adjudicating authority, who will consider the submissions of the appellant in this regard and the evidence that may be produced before him, within two months from the receipt of this order and thereafter pass orders in accordance with law.