2005 (4) TMI 434 - AT - Central Excise

Tribunal upholds Modvat credit despite invoice deficiencies, emphasizing rectification through supplementary documents

The Tribunal upheld the Commissioner's decision to allow Modvat credit despite initial deficiencies in invoices, emphasizing the rectification of missing ... Cenvat/Modvat - Duty paying documents Issues:- Modvat credit allowed based on invoices without assessable value- Dispute over Modvat credit due to missing information in invoicesAnalysis:The appeal before the Appellate Tribunal concerned the allowance of Modvat credit by the Commissioner (Appeals) based on invoices lacking the assessable value of goods. The Revenue challenged Order-in-Appeal No. 657/2003, contending that the Modvat credit should not have been permitted due to the absence of crucial information in the invoices. The Tribunal noted that the Commissioner (Appeals) justified the credit by deeming the missing assessable value as a technical lapse, emphasizing the receipt and utilization of inputs in the final product were undisputed. Additionally, the Commissioner highlighted that the respondents had subsequently provided supplementary documents containing all necessary particulars as per Notification No. 33/94 C.E. (N.T.) dated 4-7-1994. The Revenue failed to counter these findings in its Grounds of Appeal, leading the Tribunal to uphold the Commissioner's decision.Moreover, the Tribunal referenced the amendment of Rule 57G through Notification No. 7/99, clarifying that Modvat credit could not be disallowed solely for minor deficiencies in duty paying documents. Citing Circular No. 441/7/99-CX dated 22-3-99, the Tribunal highlighted that Assistant Commissioners were empowered to allow credit for duty paid on inputs or capital goods despite procedural lapses in invoices, provided the items had incurred duty and were intended for manufacturing processes. Consequently, the Tribunal concluded that since the respondents rectified the missing information by submitting the required documents, the disallowance of Modvat credit was unwarranted. The Tribunal, therefore, dismissed the Revenue's appeal, affirming the decision of the Commissioner (Appeals) to permit the Modvat credit based on the supplemented documentation.In summary, the Tribunal's judgment centered on the acceptance of Modvat credit despite initial deficiencies in the invoices, emphasizing the rectification of missing information through supplementary documents and the regulatory provisions allowing for such corrections. The decision underscored the importance of substantive compliance with duty payment requirements over minor procedural shortcomings, ultimately upholding the allowance of Modvat credit in the case at hand.