Cenvat credit cannot be denied for marginal cement weighment shortage absent diversion, pilferage, or other receipt irregularity.

Cenvat credit could not be denied merely because cement showed a marginal weighment shortage on physical receipt when the assessee had taken credit on duty-paid supplier invoices. The discrepancy was small, about 2%, and in some cases the quantity was found in excess. In the absence of any allegation of diversion in transit or pilferage, the difference was treated as attributable to weighment method and normal transit loss. Credit was therefore allowable on the invoice value and quantity.

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Issues: Whether Cenvat credit could be denied merely because the quantity of cement physically received in the factory showed a marginal shortage on weighment, when credit had been taken on the basis of the supplier's invoice and there was no allegation of diversion or pilferage.

Analysis: The credit was taken on the basis of duty-paid invoices issued by the supplier. The discrepancy in weight was small, around 2%, and in some instances the quantity was found in excess. There was no allegation that the goods were diverted in transit or that any pilferage occurred during transportation. In such circumstances, the difference was attributed to the method of weighment and to normal transit loss in the case of cement.

Conclusion: Cenvat credit could not be denied on the ground of marginal weighment shortage, and the assessee was entitled to credit on the invoice value and quantity.

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