Cenvat credit on MS Bars upheld where invoices, records, and evidence showed actual use in manufacture.

Cenvat credit on MS Bars used to fabricate clamps for transformer tanks was held admissible where the inputs were received under invoices, duly entered in statutory records, and supported by evidence of actual use in manufacture. The description of the goods, their dimensions, and Chapter Note 1(m) to Chapter 72 supported their classification under CETH 7214, while an affidavit and a Chartered Engineer's certificate reinforced the factual use of the materials. A denial based mainly on presumption about nomenclature or alleged non-use, rather than documentary evidence, was unsustainable. The disallowance of credit, interest, and penalties was therefore set aside.

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Issues: Whether Cenvat credit was admissible on the goods described as MS Bars, when the goods were received under invoices, entered in records, and used in fabrication of clamps for transformer tanks.

Analysis: The goods were found to have been received and accounted for in the appellant's statutory records, and the material on record showed their use in the manufacture of transformer tanks. The dimensions of the goods and the accompanying invoices supported classification under CETH 7214, and Chapter Note 1(m) of Chapter 72 was relied upon to show that the goods were capable of falling within that heading. The denial of credit rested mainly on a presumption that MS Bars could not be used in the manufacture of transformer tanks, rather than on documentary evidence. The affidavit of the Director and the Chartered Engineer's certificate further supported the actual use of the inputs in manufacture.

Conclusion: Cenvat credit on the inputs was admissible and the denial of credit was not sustainable.

Final Conclusion: The disallowance of credit, interest, and penalties could not be sustained, and the assessee was entitled to the relief granted by the Tribunal.

Ratio Decidendi: Where duty-paid inputs are received under invoices, duly accounted for, and shown on the evidence to have been used in manufacture, Cenvat credit cannot be denied on a mere presumption about their nomenclature or alleged non-use.

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