2017 (5) TMI 32 - AT - Central Excise

Appellant's Pre-Deposit Upheld for Appeal, Cenvat Credit Issues Highlighted

M/s. Lakshmi Paints Versus Commissioner of Central Excise, Madurai

M/s. Lakshmi Paints Versus Commissioner of Central Excise, Madurai - TMI Issues:1. Compliance with pre-deposit requirement of law.2. Eligibility of Cenvat credit upon crossing the SSI limit.3. Verification of genuineness of transactions for Cenvat credit.Compliance with Pre-Deposit Requirement:The appellant had initially deposited &8377; 59,284/- as a pre-deposit when the original duty demand was &8377; 7,90,448/-. Subsequently, the duty demand was reduced to &8377; 2,33,774/- by the learned Commissioner. Both parties agreed that a pre-deposit of 17 ½ % of the duty demand was necessary, and the deposited amount of &8377; 59,284/- fulfilled this requirement. As a result, the appeal was considered for hearing.Eligibility of Cenvat Credit Upon Crossing SSI Limit:The primary disputes in the appeal revolved around two issues. Firstly, whether the Cenvat credit, which was present in the appellant's account upon crossing the SSI limit, entitled the appellant to claim the credit. Secondly, whether the credit needed to be supported by evidence such as receipts of raw materials, recording of transactions, and actual use in manufacturing, or if mere mention of the appellant's address on invoices was sufficient for claiming the credit. The appellant argued that most of the credit satisfied the eligibility conditions, except for a specific amount that required further scrutiny due to invoices containing the residential address of the appellant.Verification of Genuineness of Transactions for Cenvat Credit:The appellate authority found discrepancies in the disallowance of certain amounts of credit. The appellant contended that they could prove the genuineness of transactions, even if invoices contained their residential address, as the goods were received in the factory and used in manufacturing. The need for verification of the genuineness of purchases and materials covered by invoices was emphasized. The matter was remanded to the adjudicating authority for a detailed examination of the appellant's pleadings and evidence to resolve the disputes effectively.In conclusion, the judgment addressed the pre-deposit requirement, the eligibility of Cenvat credit upon crossing the SSI limit, and the verification of transaction genuineness for claiming the credit. The decision highlighted the need for thorough scrutiny and verification of evidence to determine the appellant's entitlement to the Cenvat credit, ultimately remanding the matter for further examination at the adjudicating level.