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of <h1>Appellant's Duty Credit Disallowed, Rectified by Tribunal Emphasizing Prompt Reporting</h1> The appellant's credit for excess duty paid due to a clerical error was disallowed by the authorities, citing restrictions. However, the Tribunal allowed ... Modvat - Adjustment in duty credit - Excess duty paid Issues:1. Disallowance of credit for excess duty paid due to clerical error.2. Disallowance of Modvat credit for excisable products due to lack of pre-authenticated invoice.Issue 1: Disallowance of credit for excess duty paid due to clerical errorThe appellant, engaged in manufacturing pesticides, mistakenly cleared goods at 10% ad valorem instead of the correct 5% ad valorem duty rate. Upon self-discovery of the error, they issued credit notes to consignees and adjusted the excess duty paid in their records. However, the authorities disallowed this credit, citing Rule 173-I restrictions. The appellant argued that their corrective action was permissible under Delhi Collectorate Trade Notice No. 83/69 and CBEC instructions, allowing for rectification of errors before RT 12 submission. The Tribunal agreed, emphasizing that such rectifications should be promptly reported to competent authorities, and the disallowance was erroneous.Issue 2: Disallowance of Modvat credit for excisable products due to lack of pre-authenticated invoiceThe authorities disallowed Modvat credit of Rs. 40,500 for excisable products as the invoice was not pre-authenticated. The appellant contended that the invoice, marked as a duplicate for transporter for Modvat credit under Rule 57G, was valid, bearing stamps and attestation from the manufacturer's depot. The Tribunal noted the goods' duty paid status, their use as inputs in manufacturing declared outputs, and the prescribed nature of depot-issued invoices under Rule 57G. Emphasizing substantive compliance over minor procedural issues, the Tribunal overturned the disallowance, stating that the benefit should not be denied based on suspicions of late authentication. The appeal was accepted, and the impugned orders were set aside.This judgment highlights the importance of promptly rectifying errors in duty payments and recognizing valid documentation for availing Modvat credit, emphasizing substantive compliance over minor procedural discrepancies.
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