CENVAT recredit cannot be denied for delay alone when the rule sets no outer time limit after invoice cancellation.

Where the governing CENVAT rule allows recredit after cancellation of an invoice and intimation to the proper officer by the next working day, the absence of any express outer time limit means delayed availment alone cannot justify denial. The Tribunal held that a time restriction cannot be read into the rule by implication, and that recredit remains permissible once the prescribed cancellation and intimation requirements are met. On that basis, denial of the recredit was unsustainable and the matter was decided in favour of the assessee.

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Issues: Whether CENVAT recredit could be denied merely because the assessee took credit 16 months after cancellation of the invoices, where the invoices had been cancelled after intimation to the proper officer.

Analysis: The applicable rule permitted the assessee, after cancelling the invoice and sending intimation to the proper officer by the next working day, to take credit of the duty in the account. The provision did not prescribe any outer time limit for availing such recredit. Following the earlier identical decision relied upon by the Tribunal, it was held that a time limit cannot be imported by implication when the rule itself does not create one. The delayed availing of credit, by itself, was therefore not a valid ground to deny the recredit.

Conclusion: The denial of recredit was unsustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: Where the governing rule permits recredit on cancellation of an invoice after due intimation and does not prescribe any outer time limit, credit cannot be denied merely because it was taken after a delay.

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