CENVAT credit cannot be denied for missing bill of entry endorsement when duty-paid goods were received and used in the factory.

CENVAT credit should not be denied on a purely technical defect in the import document where the capital goods were duty paid, received in the manufacturer's factory, and used for installation of the plant. The documentary record, including the bill of entry, bill of lading, and letter of intent, showed the goods were meant for the appellant, and the governing rules did not require endorsement of the bill of entry as an essential condition. Where no other person had taken the credit, substantive entitlement prevailed over the missing endorsement.

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Issues: Whether CENVAT credit could be denied merely because the bill of entry stood in the name of the contractor with endorsement in favour of the appellant, when the imported capital goods were duty paid, received in the appellant's factory, utilised for installation, and no credit had been taken by the contractor.

Analysis: The documentary record showed that the bill of entry, bill of lading and letter of intent collectively established that the goods were meant for the appellant, were cleared on payment of duty, and were delivered directly to the appellant's factory for use in setting up the plant. The relevant credit rules permitted availment on the basis of a bill of entry and also protected credit where documents were not fully complete, provided the duty-paid character of the goods, their receipt, and utilisation were established to the satisfaction of the authority. The absence of a provision requiring endorsement of the bill of entry, coupled with the fact that the contractor had not availed the credit, meant that a purely technical objection could not defeat substantive entitlement.

Conclusion: The denial of CENVAT credit was unsustainable and the credit was rightly allowable to the appellant.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: CENVAT credit cannot be denied on a technical defect in the import document when the goods are shown to be duty paid, received by the manufacturer, utilised in the factory, and not credited by any other person, and the governing rules do not require endorsement of the bill of entry as an essential condition.

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