CENVAT credit depends on prescribed duty-paying documents, even where eligibility on merits is otherwise established.

CENVAT credit on machinery used to set up a sugar plant was recognised as admissible on merits, following the Tribunal's earlier view in the assessee's own case. However, credit taken on xerox copies of invoices was disallowed because the CENVAT Credit Rules, 2002 required original or duplicate duty-paying documents, and xerox copies did not satisfy that statutory documentary condition. The result was that, even where underlying eligibility to credit existed, non-compliance with the prescribed document requirement defeated availment of the credit.

---

---

Issues: (i) Whether the respondent was entitled to CENVAT credit on capital goods used for setting up a sugar plant. (ii) Whether CENVAT credit could be availed on xerox copies of invoices under the CENVAT Credit Rules, 2002.

Issue (i): Whether the respondent was entitled to CENVAT credit on capital goods used for setting up a sugar plant.

Analysis: The capital goods were machinery for the sugar plant and the dispute had earlier arisen on the same issue in the respondent's own case. The Tribunal had already held that CENVAT credit was admissible on such machinery, and the present record disclosed no reason to depart from that view on merits.

Conclusion: The issue was answered in favour of the respondent on merits.

Issue (ii): Whether CENVAT credit could be availed on xerox copies of invoices under the CENVAT Credit Rules, 2002.

Analysis: During the relevant period, the rules required availment of credit on original or duplicate duty paying documents. The respondent had taken credit only on xerox copies, and the absence of original or duplicate invoices was not treated as a permissible exception under the governing rule. Accordingly, the credit did not satisfy the statutory document requirement.

Conclusion: The issue was answered against the respondent and in favour of the Revenue.

Final Conclusion: The order granting credit could not stand, and the Revenue succeeded because the credit was otherwise supported on merits but failed on the mandatory documentary requirement for availment.

Ratio Decidendi: CENVAT credit can be denied where the assessee does not possess the prescribed original or duplicate duty paying documents, even if the underlying entitlement to credit is otherwise available on merits.

---