Tribunal Grants Waiver on Duty & Penalty: Cenvat Credit Rule 15(2) Applied

The Tribunal found in favor of the appellant, granting a waiver of pre-deposit of confirmed duty and penalty under Rule 15(2) of Cenvat Credit Rules, 2004. The appellant successfully demonstrated that despite the bill of entry being in the name of the Head Office, the goods were received at their factory premises, justifying the availment of Cenvat credit. The Tribunal held that the non-mentioning of the appellant's name in the bill of entry was a curable defect, as the actual receipt of the consignment was not in dispute. Consequently, the recovery was stayed pending the appeal's disposal.

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Issues:
Waiver of pre-deposit of confirmed duty and penalty under Rule 15(2) of Cenvat Credit Rules, 2004 based on ineligible Cenvat credit availed by the appellant.

Analysis:
The appellant filed a stay petition seeking the waiver of pre-deposit of Rs. 3,06,369/- confirmed as duty along with an equal amount of penalty under Rule 15(2) of Cenvat Credit Rules, 2004. The lower authorities confirmed these amounts as ineligible Cenvat credit availed by the appellant on imported polyesters based on bills of entry in the name of the Head Office. The appellant's counsel argued that despite the bill of entry being in the name of the Head Office, the appellant factory could still avail the Cenvat credit once the goods were received at the factory premises. The counsel relied on previous decisions to support this argument. The departmental representative reiterated the findings of the lower authorities.

Upon reviewing the records and the correlation presented by the appellant's counsel regarding the movement of Polyester imported under a specific bill of entry, the Tribunal observed that the container number on the bill of entry matched the transport documents, indicating delivery to the appellant at Silvassa. This correlation demonstrated that the appellant had indeed received the consignment, even though the bill of entry was in the name of the Head Office. The Tribunal concluded that the non-mentioning of the appellant's name in the bill of entry was a curable defect since there was no dispute regarding the receipt of the consignment at the appellant's factory.

Consequently, the Tribunal found that the appellant had established a strong prima facie case for the waiver of pre-deposit of the amounts in question and ordered the recovery to be stayed until the appeal was disposed of. The decision was dictated and pronounced in the Court by Mr. M.V. Ravindaran.

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