Appeal allowed against denial of credit by Central Excise Commissioner.

The appeal was filed against the denial of credit by the Commissioner of Central Excise, Kolkata-II, and the demand for interest and penalty under the Central Excise Act. The Tribunal held that denial of credit based on non-registration of depots was unjustified, citing legal precedents. The order denying credit and imposing interest and penalties was set aside, and the appeal was allowed in favor of the Appellant. The Tribunal concluded that since the credit was deemed admissible, there was no basis for demanding interest or penalties.

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Issues Involved:
- Denial of credit availed by the Appellant by the Commissioner of Central Excise, Kolkata-II.
- Demand for interest and penalty under Section 11AC of the Central Excise Act, 1944 read with Rule 15(2) of the CENVAT Credit Rules, 2004.

The present appeal was filed against the Order-in-Original denying credit availed by the Appellant and demanding interest and penalty. The dispute revolved around the credit distributed by various depots of the Appellant without Service Tax registrations or before obtaining registration. The Appellant argued that registration of depots is not a prerequisite for CENVAT credit as all expenditure up to the place of removal had been included in the assessable value on which duty was paid, making them eligible for credit of input services used up to the depots. They cited legal precedents supporting their contention, including decisions from the Madras High Court, Gujarat High Court, and Tribunal Kolkata.

The Tribunal observed that the dispute centered on the credit distributed by the Appellant's depots across the country, which was denied due to lack of Service Tax registrations or pre-registration distribution. It was noted that services received by the depots were eligible input services to the Appellant, and denial of CENVAT credit based on non-registration of depots was deemed unsustainable. Legal precedents were cited, emphasizing that procedural irregularities like non-registration should not disentitle an entity from availing CENVAT credit.

The Tribunal referenced various judicial pronouncements, including decisions from the Madras High Court, Gujarat High Court, and Tribunal Kolkata, which supported the Appellant's argument that substantial benefit should not be denied due to procedural infractions. It was held that denial of CENVAT credit based on non-registration or delayed registration of depots was not legally justified. The impugned order was set aside, and the appeal filed by the Appellant was allowed. The Tribunal concluded that since the credit was deemed admissible, there was no basis for demanding interest or imposing penalties.

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