CEGAT Kolkata Upholds Duty Disallowance but Allows Credit for Endorsed Bill

The Appellate Tribunal CEGAT, Kolkata confirmed duty of Rs. 1,17,50,131.82 by disallowing Modvat Credit based on endorsed bills of entry. The appellants were denied credit except for a specific bill of entry dated 19-10-1993, where goods were endorsed from the Head Office to their working place, entitling them to a credit of Rs. 33,01,723.27. The Tribunal held that the delay in endorsement did not affect credit eligibility as goods remained under the appellants' ownership. The appeal was rejected for the remaining duty amount confirmed against the appellants.

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Issues involved: Confirmation of duty by disallowing Modvat Credit based on endorsed bills of entry.

Summary:
The Appellate Tribunal CEGAT, Kolkata, in the case, confirmed duty of Rs. 1,17,50,131.82 by disallowing Modvat Credit to the appellants as it was availed based on endorsed bills of entry. The appellants did not contest this disallowance due to a previous Tribunal decision. However, they argued that for a specific bill of entry dated 19-10-1993, where goods were received by their Head Office and then endorsed to TISCO Growth Shop, they should be allowed a credit of Rs. 33,01,723.27 based on a previous Tribunal order in their favor.

The Tribunal considered both sides' arguments and held that the appellants were not entitled to Modvat Credit for endorsed bills of entry as per the Larger Bench decision. However, for the bill of entry dated 19-10-1993, where the endorsement was from the appellants' Head Office to their own working place, they were entitled to the credit. The Tribunal noted that the exact date of endorsement was not available on record, and the delay in endorsement did not affect the credit eligibility as the goods remained under TISCO's ownership throughout the process. Therefore, except for the specific bill of entry dated 19-10-1993, involving a credit of Rs. 33,01,723.27, the appeal was rejected for the remaining duty amount confirmed against the appellants.

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