Cenvat credit on returned duty-paid goods is not denied for missing prior intimation or extra receipt documents.

Rule 16 permits Cenvat credit on duty-paid goods returned to the factory for remaking, refinement, reconditioning or other authorised purposes, and it does not impose a separate requirement of prior intimation to the department or production of lorry receipts, GR notes or similar additional documents on receipt of such goods. Where the record shows receipt of the returned goods and their clearance on payment of duty, credit cannot be denied merely for want of those extra formalities. On that basis, the demand and penalty were held unsustainable, and the adjudication order was set aside with consequential relief.

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Issues: Whether Cenvat credit on duty-paid returned goods was admissible under Rule 16, and whether the manufacturer was required to furnish additional documents or prior intimation to the department on receipt of such goods.

Analysis: The dispute related to credit taken on gear boxes returned to the factory for remaking, refinement, reconditioning or other permitted purposes. The Tribunal found that Rule 16 does not prescribe any specific procedure requiring prior intimation to the department or production of documents such as lorry receipts or GR notes for receipt of returned goods. The record also showed receipt of the goods and clearance on payment of duty, and no departmental circular was shown to impose a further requirement. Reliance was placed on earlier Tribunal decisions taking the same view.

Conclusion: The credit could not be denied on the ground of absence of the alleged additional documents or intimation, and the impugned demand and penalty were unsustainable.

Final Conclusion: The appeal succeeded and the adjudication order was set aside with consequential relief.

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