Natural justice and Cenvat credit: denial of transport-document opportunity led to remand for fresh adjudication.

Cenvat credit could not be rejected solely on the ground that transport documents were not produced when the assessee had claimed receipt of inputs through transporters and entry of goods in factory records. An adverse finding could not be sustained without first giving the assessee an opportunity to produce the relied-upon transport evidence. Denial of that opportunity amounted to a breach of natural justice, so the impugned order was set aside and the matter was remanded for de novo adjudication after allowing filing of the evidence.

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Issues: Whether the order denying Cenvat credit could be sustained when the assessee was not given an opportunity to produce transport documents to prove receipt of inputs.

Analysis: The dispute concerned a demand of Cenvat credit on the allegation that invoices were received without actual receipt of goods. The appellate authority recorded that the transport documents were not produced, but the record also showed that the assessee had asserted receipt of inputs through transporters and entry of the goods in its factory records. In these circumstances, the assessee was required to be given an opportunity to produce the transport documents before an adverse finding was recorded. Denial of such opportunity amounted to breach of natural justice.

Conclusion: The impugned order was set aside and the matter was remanded to the Commissioner (Appeals) for de novo adjudication after giving the assessee an opportunity to file the relied-upon evidence.

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