Cenvat credit under dual methods sustained where declarations and duty documents supported different input categories.

Cenvat credit under Rule 9A could be availed through both the duty-paying document route and the formula-based route for different categories of inputs, because the rule did not prohibit a manufacturer from using both methods where each was otherwise eligible. Credit for inputs contained in finished goods lying in stock was also upheld, as the manufacturer had made the required declaration and later produced supporting duty documents, and the disputed credit was substantiated on the record. The denial was further unsustainable because the objection based on belated filing of documents was not raised in the show cause notice. The restriction imposed by the lower authority was therefore not sustainable.

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Issues: Whether manufacturers could avail Cenvat credit simultaneously under Rule 9A(1) on the basis of duty paying documents and under Rule 9A(3) on the formula basis, and whether credit relating to inputs contained in finished goods could be denied when the relevant ground was not proposed in the show cause notice.

Analysis: The Rule did not prohibit an eligible manufacturer from availing credit by both methods for different categories of inputs. The appellants had made the declaration required for credit on inputs in stock and inputs in process, and later produced duty paying documents to support credit on inputs contained in finished goods lying in stock. The records showed that the disputed credit was otherwise supported by declaration and documents. The denial was also unsustainable because the belated filing of documents in respect of inputs contained in finished goods was not a ground taken in the show cause notice.

Conclusion: The appellants were entitled to the disputed credit, and the restriction imposed by the lower authority was not sustainable.

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