Cenvat credit on duty-paid inputs cannot be denied for a technical invoice defect when the documentary trail is complete.

Cenvat credit on duty-paid paper used for taxable services could not be denied merely because the invoices passed through intermediary sellers rather than being issued directly on the manufacturer's invoice. The documented trail, including the manufacturer's invoice, VAT invoices of the re-sellers, and cross-reference to the manufacturer's invoice number, sufficiently linked the goods cleared with the goods received by the assessee. The absence of a direct manufacturer invoice was only a technical defect and not a substantive basis to reject credit. Denial of Cenvat credit was therefore unjustified, and the credit was allowable.

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Issues: Whether Cenvat credit on paper used as input for providing taxable services could be denied merely because the invoices were issued through intermediary sellers and not directly on the manufacturer's invoice.

Analysis: The input paper was admittedly duty paid and used in the provision of taxable services. The invoices issued by the manufacturer, the VAT invoices issued by the re-sellers, and the endorsement/reference to the manufacturer's invoice number together established a clear link between the goods cleared by the manufacturer and the goods received by the appellant. In such circumstances, the mere fact that the credit was not supported by a direct manufacturer's invoice was held to be a technical objection and not a substantive ground to deny credit.

Conclusion: The denial of Cenvat credit was unjustified and the credit was allowable in favour of the assessee.

Ratio Decidendi: Cenvat credit cannot be denied when the documentary trail clearly links duty-paid inputs to the recipient's use, and the absence of a direct manufacturer's invoice is only a technical defect.

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