Cenvat credit on registered dealer invoices survives where statutory records support receipt and Revenue lacks corroborative proof of non-receipt.

Cenvat credit cannot be denied merely because a registered dealer was later found not to be operating from the recorded address, where the buyer acted on invoices showing excise registration particulars, entered the credit in statutory records, filed returns and paid by cheque. Rule 7 of the Cenvat Credit Rules, 2004 requires reasonable verification of the supplier's identity and address, and that requirement was treated as satisfied on these facts. In the absence of corroborative evidence that the inputs were not received or were sourced elsewhere, uncorroborated statements and a separate investigation were insufficient to displace the documentary record. The disallowance, interest and penalty were therefore unsustainable.

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Issues: Whether Cenvat credit could be denied merely because the registered dealer was later found not to be functioning from the recorded address and the Revenue alleged that no goods were supplied against the invoices.

Analysis: Rule 7 of the Cenvat Credit Rules, 2004 requires the recipient to take reasonable steps to verify the identity and address of the supplier. Where the supplier was registered with the department and the invoices carried the excise registration particulars, the recipient is taken to have complied with that requirement. The invoices were issued by the registered dealer, the credit was duly recorded in the statutory registers and returns, and payment was made through cheque. The Revenue did not produce any material showing that the appellant obtained the goods from an alternative source or that the inputs were not received. The investigation against a different manufacturer and the uncorroborated statements relied upon by the Revenue were found insufficient to displace the documentary record supporting receipt of inputs.

Conclusion: Cenvat credit could not be denied on the facts proved by the Revenue, and the disallowance, interest and penalty were unsustainable.

Final Conclusion: The appeal succeeded and the assessee was held entitled to consequential relief.

Ratio Decidendi: Cenvat credit cannot be denied to a buyer who has acted on invoices issued by a registered dealer and has maintained supporting statutory records, unless the Revenue proves by corroborative evidence that the inputs were not received or were procured from some other source.

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