Supplier's classification cannot be altered at the recipient's end to deny Cenvat credit on duty-paid goods.

A recipient of duty-paid goods cannot unilaterally reclassify the supplier's declared description to deny Cenvat credit where the supplier's classification has not been disturbed at the supplier's end. The dispute involved boiler parts invoiced under Chapter 84, while revenue sought to treat them as general-purpose materials under Chapter 72 at the recipient's end. Applying the principle that the manufacturer's classification cannot be altered in the recipient's hands, the tribunal held that the supplier's classification remained binding for credit purposes. The assessee was therefore entitled to Cenvat credit.

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Issues: Whether the recipient of duty-paid goods can dispute the classification declared by the supplier for the purpose of denying Cenvat credit.

Analysis: The goods were supplied as boiler parts and the supplier's invoices described them under Chapter Heading 84. The credit dispute arose only because the revenue sought to treat the items as general-purpose materials falling under Chapter 72 at the recipient's end. The governing principle applied was that where the supplier has classified the goods and that classification has not been disturbed at the supplier's end, the recipient cannot unilaterally alter the classification for denying credit. The decision relied on the rule placing the burden of proof on the person taking credit and on the principle that the recipient cannot change the manufacturer's classification in its own hands.

Conclusion: The classification shown by the supplier could not be disturbed at the recipient's end for denying Cenvat credit, and the assessee was entitled to credit.

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