Tribunal grants cenvat credit for imported spare parts based on proper record-keeping

The Tribunal allowed the appeal, finding the appellant eligible for cenvat credit based on photocopies of courier bill of entries for importing spare parts as inputs. The Tribunal considered the appellant's compliance with Customs procedures, proper record maintenance, and lack of malafide intent, setting aside the demand and penalty imposed by the adjudicating authority. The appellant was granted consequential benefits in accordance with the law.

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Issues involved: Whether the appellant rightly took cenvat credit based on 'courier bill of entry' for import of inputs - spare parts.

Comprehensive Details:

1. Issue of Cenvat Credit Eligibility: The appellant availed cenvat credit based on photocopies of six Courier Bills of Entries, totaling Rs.77,446. Revenue contended that photocopy of bill of entry is not a prescribed document under Rule 9(1)(c) of CCR. Show cause notice was issued proposing disallowance of credit and penalty for the period May 2016 to November 2016.

2. Defence and Tribunal Rulings: Appellant defended by stating that spare parts were imported through a Courier Agency following Customs procedures. The Courier Agency filed a consolidated bill of entry, providing only a photocopy to the appellant. Appellant cited Tribunal rulings allowing cenvat credit based on photocopies of bill of entries in similar cases, emphasizing proper record maintenance and no dispute regarding duty payment or use of inputs.

3. Adjudication and Appeal: Show cause notice was adjudicated against the appellant, relying on CBEC Circular permitting authorized couriers to file 'regular bill of entry'. The demand was confirmed with a penalty. Commissioner (Appeals) dismissed the appeal due to non-payment of pre-deposit.

4. Tribunal Decision: The Tribunal found that the appellant imported spare parts as inputs for production, supported by evidence such as purchase invoices and statutory records. Considering previous Tribunal rulings and the challenges of importing through couriers, the Tribunal allowed the appeal, noting the lack of malafide intent in claiming cenvat credit based on photocopies of courier bill of entry.

5. Conclusion: The Tribunal set aside the impugned order, granting the appellant consequential benefits in accordance with the law.

[Order dictated & pronounced in open court].

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