Cenvat credit on duty-paid clearance of inputs as such cannot be denied merely because the goods moved on the assessee's invoices.

Cenvat credit could not be denied where inputs received from Tata Steel were later cleared as such on payment of duty on the assessee's own invoices and then used in manufacture of final products. The Revenue objected only to the credit relating to those inputs, but did not dispute other clearances made on the same invoicing basis. Applying the Cenvat principle that inputs removed as such must suffer duty, the document states that duty-paid clearance of the inputs removed any basis to deny credit merely because the goods moved on the assessee's invoices. The denial of Cenvat credit was therefore unsustainable and was set aside.

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Issues: Whether Cenvat credit could be denied on inputs cleared on payment of duty on the assessee's own invoices after receipt from Tata Steel and subsequent purchase of the same inputs for use in manufacture.

Analysis: The undisputed position was that the assessee received inputs from Tata Steel, took credit on receipt, and later cleared the same inputs on payment of duty. The Revenue did not object to clearances made to other customers on the assessee's invoices and disputed only the credit taken on the inputs that were purchased from Tata Steel. The governing principle under the Cenvat scheme was that inputs removed as such had to suffer duty, and where duty was paid on such clearance, credit could not be denied merely because the inputs were moved on the assessee's own invoices. Since the assessee had paid duty on the clearances and the inputs were used in the manufacture of final products, the denial of credit had no sustainable basis.

Conclusion: The denial of Cenvat credit was not justified and was set aside in favour of the assessee.

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