Cenvat credit survives procedural lapse where goods are timely accounted for and loss of duplicate invoice is duly intimated.

Cenvat credit may be sustained where the duplicate invoice is lost in transit, the jurisdictional Assistant Commissioner is informed, and credit is taken on the original invoice, provided there is no finding that the goods were not received or duty was not paid. A delayed Part II entry will not by itself defeat credit if receipt of duty-paid goods was entered in Part I within time and the omission is merely clerical. The stated principle is that substantial compliance with the credit provisions prevails over procedural lapses when the statutory conditions of receipt and accounting are met.

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Issues: (i) Whether credit could be availed on the basis of the original invoice when the duplicate invoice was lost in transit and the jurisdictional Assistant Commissioner had been intimated. (ii) Whether credit was deniable because it was taken after six months from the dates of the bills of entry, although receipt of the goods had been entered in Part I of the credit register within time.

Issue (i): Whether credit could be availed on the basis of the original invoice when the duplicate invoice was lost in transit and the jurisdictional Assistant Commissioner had been intimated.

Analysis: Rule 57G(6) permits credit on the basis of original invoice in specified circumstances, subject to the satisfaction of the Assistant Commissioner. The assessee had informed the jurisdictional Assistant Commissioner about the loss of the duplicate copy in transit and proposed to take credit on the strength of the original invoice. In the absence of any finding that the goods were not received or that they were not duty paid, the explanation could not be rejected merely for want of satisfaction on the facts disclosed.

Conclusion: The denial of credit on this ground was not justified and the issue was decided in favour of the assessee.

Issue (ii): Whether credit was deniable because it was taken after six months from the dates of the bills of entry, although receipt of the goods had been entered in Part I of the credit register within time.

Analysis: Rule 57G(5) bars taking credit after six months from the relevant documents, but the process of taking credit involves both recording receipt of goods in Part I and posting the credit in Part II. The receipt of the duty-paid goods had been entered within the prescribed time, and the delayed entry in Part II was treated as a clerical omission without mala fides. The reasoning was supported by the view that substantial compliance had been achieved when the goods were timely accounted for in Part I.

Conclusion: The credit could not be denied on this ground and the issue was decided in favour of the assessee.

Final Conclusion: The disallowance of Cenvat credit was set aside and the assessee was held entitled to the consequential relief available in law.

Ratio Decidendi: Where the statutory conditions for credit are substantially complied with, and the goods are shown to have been received and accounted for in time, credit cannot be denied for a procedural lapse such as delayed entry or for taking credit on the original invoice after duly intimating loss of the duplicate copy, absent contrary findings on receipt or duty payment.

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