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Issues: Whether Modvat credit taken on the basis of depot invoices could be disallowed merely because the duty shown in the invoices exceeded the duty actually paid by the manufacturer, and whether the matter was rightly remanded for verification under Rule 57GG of the Central Excise Rules, 1944.
Analysis: The respondents had taken credit only of the duty amount reflected in the depot invoices issued under Rule 57GG. There was nothing on record to show that any notice or action had been taken against the dealer or depot for the alleged incorrect calculation of duty in the invoices. The appeal did not dispute the practice of oil companies issuing such invoices or the basis on which the Commissioner (Appeals) had directed verification of the difference between duty paid by the manufacturer and duty shown in the depot invoices. In these circumstances, the direction to remand the matter for ascertaining the correct position and the reasons for the discrepancy was justified.
Conclusion: The remand order was upheld and the Revenue's challenge failed.
Ratio Decidendi: Where credit is taken on the strength of depot invoices issued under the governing excise procedure, and the discrepancy in duty shown versus duty actually paid has not been examined by taking action against the issuing depot or dealer, a remand for factual verification is proper and disallowance cannot be sustained without such inquiry.
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