Tribunal Upholds Cenvat Credit Claim for Moulds Not Physically Moved

The Tribunal allowed the appeal and upheld the appellant's claim for cenvat credit of Rs.8,69,320 for moulds not physically moved between premises. The Tribunal emphasized the importance of a pragmatic and practical approach to the law, considering the practical arrangement between the parties as reflected in the invoice. As there was no evidence of malafide intent in claiming the credit, the Tribunal ruled in favor of the appellant, highlighting that rules should serve justice and not act as obstacles.

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Issues:
Claim of cenvat credit for moulds not physically moved between premises.

Analysis:
The appellant's job worker manufactured moulds for the appellant's use in manufacturing intermediate goods without physically moving the moulds between premises. The Revenue disallowed cenvat credit of Rs.8,69,320/- on the grounds that the moulds were not physically received by the appellant. The Revenue argued that the movement of goods is mandatory for claiming cenvat credit, and mere paper entries were insufficient. However, the job worker explicitly stated in the invoice that the moulds were the property of the appellant and used for manufacturing components. This statement was uncontested, and there was no malafide intent on the part of the appellant. The Tribunal emphasized that the rules should serve justice and not act as obstacles. The practical arrangement between the parties, as reflected in the invoice, was considered valid. The Tribunal highlighted the importance of a pragmatic and practical approach to the law. Since there was no evidence of malafide intent in claiming the cenvat credit, the appeal was allowed, and the appellant's claim was upheld.

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