Cenvat credit denied where invoices were found fraudulent and supporting records failed to prove genuine input receipt.

Cenvat credit was held unsustainable where the assessee relied on invoices issued by a registered dealer, but the surrounding record indicated a fraudulent invoice chain. Although road permits and cheque payments were produced, the Tribunal found those documents insufficient to establish genuine receipt of inputs or reliable entitlement to credit. Applying the cited precedent to the facts, it concluded that the earlier relief granting credit could not stand and that the Revenue's challenge succeeded.

---

---

Issues: (i) Whether Cenvat credit was admissible where the assessee claimed receipt of inputs on invoices issued by a registered dealer, but the department alleged the invoices were fraudulent and the dealer chain was not genuine.

Issue (i): Whether Cenvat credit was admissible where the assessee claimed receipt of inputs on invoices issued by a registered dealer, but the department alleged the invoices were fraudulent and the dealer chain was not genuine.

Analysis: The Tribunal compared the facts with the principles applied in the cited precedent and noted that the assessee had produced road permits and evidence of payment by cheque. It, however, found that the present record disclosed a fraudulent element in the invoices and that the circumstances were not sufficient to sustain the credit merely on the basis of the documents relied upon by the assessee. The Tribunal therefore held that the earlier appellate relief granting credit could not be sustained on these facts.

Conclusion: The issue was decided against the assessee and in favour of the Revenue.

Final Conclusion: The Revenue's challenge succeeded and the order allowing Cenvat credit was set aside.

Ratio Decidendi: Cenvat credit is not sustainable where the surrounding facts establish that the supporting invoices are fraudulent and the assessee fails to establish entitlement to credit on reliable and genuine documentation.

---