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of <h1>Court affirms credit for capital goods despite alert notice, no fraud found</h1> <h3>COMMISSIONER OF CUSTOMS & C. EX., RAIPUR Versus SATYA POWER & ISPAT PVT. LTD.</h3> COMMISSIONER OF CUSTOMS & C. EX., RAIPUR Versus SATYA POWER & ISPAT PVT. LTD. - 2013 (294) E.L.T. 524 (Tri. - Del.) Issues:Appeal against denial of credit on capital goods due to alert notice about supplier's activities.Analysis:The appeal was filed by the Revenue against an order by the Commissioner (Appeals) regarding the denial of credit on capital goods purchased by the respondent from a specific supplier. The Revenue's contention was based on an alert notice issued in 2008, suggesting that the supplier was not engaged in manufacturing activities but only issuing duty paying documents. The adjudicating authority upheld the demand and imposed a penalty, which was challenged by the respondent. The Commissioner (Appeals) set aside the adjudication order, leading to the Revenue's appeal.The respondent argued that the duty on the capital goods was paid by the supplier, and there was no evidence to suggest otherwise. Despite the alert notice in 2008, the respondent had received the capital goods in 2005 and availed credit for the duty paid. During a physical verification, the capital goods were found in the respondent's factory, supporting the legitimacy of the credit availed. The respondent maintained that the impugned order was correctly decided based on these facts.The judge noted that the capital goods were received in 2005, and the credit for duty paid was availed in 2008, coinciding with the alert notice about the supplier. Upon a visit to the respondent's factory, the Revenue officer confirmed the presence of the capital goods for which the credit was claimed. The absence of specific markings from the supplier on the capital goods was the respondent's only objection. However, there was no evidence to suggest that the respondent procured the goods from a different supplier or engaged in any fraudulent activity. As the capital goods were physically present in the factory during the Revenue officer's visit, the judge found no fault in the impugned order and dismissed the appeal.In conclusion, the judgment upheld the Commissioner (Appeals)' decision in favor of the respondent, emphasizing the importance of physical verification and legitimate credit availed on capital goods despite concerns raised by an alert notice about the supplier's activities.
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