2001 (5) TMI 651 - AT - Central Excise

Tribunal remands case on Modvat credit denial due to Bill of Entry discrepancies

INDIAN ALUMINIUM COMPANY LTD. Versus COMMR. OF CENTRAL EXCISE, PATNA

INDIAN ALUMINIUM COMPANY LTD. Versus COMMR. OF CENTRAL EXCISE, PATNA - 2001 (138) E.L.T. 311 (Tri. - Kolkata) Issues: Denial of Modvat credit based on photocopy of Bill of Entry and endorsement of Bill of Entry in favor of corporate office instead of factory.Issue 1: Denial of Modvat credit based on photocopy of Bill of EntryThe appellant contested the denial of Modvat credit based on the photocopy of the Bill of Entry. The appellant's advocate clarified that the credit was originally taken based on the triplicate copy of the Bill of Entry. Due to discrepancies in the imported quantity of Caustic Soda, the original copy was sent back for rectification, leading to the loss of the triplicate copy. Upon request, a reconstructed copy was prepared by Customs, and the credit was claimed based on this reconstructed copy. The advocate argued that Modvat credit is permissible on a reconstructed Bill of Entry, citing relevant tribunal cases. The Tribunal found that the dispute regarding the nature of the document used for claiming credit required verification at the original level. Consequently, the matter was remanded for further examination.Issue 2: Endorsement of Bill of Entry in favor of corporate office instead of factoryThe denial of Modvat credit was also based on the Bill of Entry being drawn in favor of the appellant's corporate office rather than the factory. The appellant's advocate explained that documents showing the Head Office address are acceptable for availing credit at the factory, provided they are endorsed in favor of the factory. In this case, due to an initial error, the documents were first endorsed in favor of a different factory that did not use the imported material. Upon realizing the mistake, the endorsement was corrected in favor of the correct factory. The Tribunal held that if the Bill of Entry was properly endorsed in favor of the appellant's factory and there were no issues regarding material receipt and duty payment, Modvat credit should not be denied. As this aspect required verification, the Tribunal set aside the previous order and remanded the matter for fresh consideration at the original level.In conclusion, the Tribunal allowed the appeal by way of remand, emphasizing the need for verification of crucial facts related to the Modvat credit denial. The decision highlighted the importance of accurate documentation and proper endorsement in determining the eligibility for claiming credit, directing further proceedings to ensure a fair assessment of the appellant's entitlement to Modvat credit.