TaxTMI 
TaxTMI 
2017 (11) TMI 831
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....red with Central Excise Department for the purpose of accounting the manufacture of various products and for paying appropriate excise duty as applicable in terms of Central Excise Act, 1944 (in short, 'the Act'). One of the products manufactured by the assessee company is "Analgin". For the manufacture of the said product, among other inputs, three raw materials namely, Methyl Aceto Acetate, Cysteamine and Isoprophyl Alcohol are required, which, the assessee company regularly imported from abroad. (ii) During the relevant period, under the Central Excise Rules, 1944 (hereinafter referred to as, 'Rules'), there was a scheme called MODVAT scheme. According to the scheme, a manufacturer of excisable goods is permitted to avail credit of excise duty paid on various inputs, or countervailing duty or additional duty paid on the imported raw materials, and utilize the same for the purpose of paying duty on the finished goods. (iii) The assessee company filed declarations and had details as required under Rules, accordingly, they were availing credit of excise duty paid on the locally procured materials, and credit of additional duty paid on imported mate....
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....ed. (viii) Therefore, the Superintendent of Central Excise issued a show cause notice to the petitioner company on 29.6.1994 asking to show cause as to why the duty availed by the assessee company should not be expensed under Rule 57(I) and penalty should not be imposed against them under Rule 173Q for violation of Rule 57 G r/w Rule 173G of the Rules. (ix) In response to the said show cause, the assessee company had sent a reply on 29.7.1994, wherein the assessee had stated that, since the original of the triplicate copy of the Bill of Entry, was lost during transit, from Head Office to factory, the assessee company had approached the Assistant Commissioner of Customs, Madras, who after scrutiny of documents, had issued attested triplicate copy of Bills of Entry No. 41662 dated 08.11.1993, in respect of import of Cysteamine HCL and for remaining Bill of Entry, the Assistant Commissioner of Customs had assured to issue after verification of original Bill of Entry with the customs. Therefore, the assessee company requested further time extension to produce the certified copy to be issued by the Customs Department in respect of other Bills of Entry. Afterwards on 17....
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....the appeals by setting aside the order of Commissioner (Appeals) dated 26.6.1996. Aggrieved by the said order of CEGAT, dated 15.3.2001, the assessee, in fact filed writ petition in W.P.No.21602 of 2001 which was admitted on 09.11.2001 and was pending before this Court. However, by order dated 21.7.2011, a learned Judge, who heard the said writ petition, had passed an order in W.P.M.P.No.418 of 2011, whereby, the learned Judge permitted the assessee to convert the said W.P.No.21602 of 2001 into Civil Miscellaneous Appeal (CMA) under Section 35 G of the Act. Accordingly, the said writ petition has been converted / re-numbered as C.M.A.No.2545 of 2011 with substantial questions of law to be decided by this Court. Accordingly, the present CMA was admitted on 21.10.2011 by a Division Bench of this Court whereby the following three questions of law had been framed: "1. Whether a certified copy of bill of entry filed under the Customs Act, 1962 can be accepted as a specified document under Rule 57G of Central Excise Rules, 1944 for the purpose of availment of MODVAT credit? 2. Whether the first respondent was justified in law while denying the availment of MODVAT credit....
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....hat inputs had not reached the factory with documents and accordingly, not subjected to excise duty. 7. Therefore, the learned counsel for the assessee would submit that, only at the time of filing the returns, since the triplicate copy of the Bill of Entry was not available as it had been lost during transit, it could not be filed. However, inorder to show its bonafide and as a token of proof that the duty for the subject imported goods had already been paid, and the same had been used as an input at the factory of the assessee / manufacturer, it produced the certified photocopy of Bill of Entry duly certified by the customs authorities. Therefore, the learned counsel would state that the non-filing of original triplicate copy of Bill of Entry, either at the time of filing of returns or pursuant to the show cause notice issued by the Revenue, should not be a reason to deny such MODVAT credit taken by the assessee. 8. Per contra, Mr.A.P.Srinivas, learned standing counsel appearing for the Revenue, has relied upon the following Judgments to substantiate his contentions that the photo copy of original documents cannot supplant the necessity of producing original documents as co....
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.... three such raw materials had been imported by the assessee for which duty had been paid against the Bill of Entry dated 22.11.1993, 11.11.1993 and 17.11.1993. It is also not in dispute that pursuant to the said Bill of Entry, after having paid the duty, the goods were cleared from the customs and sent to the factory of the assessee located at Cuddalore, where the assessee claimed MODVAT credit against each of the import and those claims had been registered and details entered in the MODVAT register, namely, RG23 Part I and Part II and RG23A Part I and Part II. 13. It is the further case of the assessee that, subsequently, the original triplicate copy of the Bill of entry had been sent to Chennai Head Office for preparation of the budget for the year 1993-94 and after the exercise, when it was dispatched along with other documents, during transit it was lost, and therefore, the assessee's factory at Cuddalore was not able to produce the said original triplicate copy of Bills of Entry at the time of filing the returns. 14. Though the aforesaid claim on the side of the assessee had not been specifically disputed by the Revenue, it had issued show cause notice to the assesse....
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....ued by an Appraiser of Customs posted in foreign post office; (e) an invoice issued by a first stage dealer of excisable goods, registered under Rule 174; (f) an invoice issued by a second stage dealer of excisable goods registered under Rule 174 and duly authenticated by the proper officer; (g) an invoice issued by a dealer on or before the 31st day of August, 1996; (h) an invoice issued by an importer registered under Rule 174 and duly authenticated by the proper officer; (i) an invoice issued by an importer from his depot or from the premises of the consignment agent of the said importer provided the said depot or the premises, as the case may be, is registered under Rule 174, and duly authenticated by the proper officer; (j) an invoice issued by a first stage or second stage dealer of imported goods registered under Rule 174 and duly authenticated by the proper officer; (k) duplicate copy of a bill of entry generated on Electronic Data Interchange System installed in any Customs or Central Excise Commissionerate; (l) a certificate issued by the Superintendent of Central Excise of by the proper officer in th....
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....the MODVAT credit can be taken on the basis of the photostat copy of BOE " 22. The aforesaid question of law framed in the said case is exactly similar to that of the 1st question of law framed in this case also. 23. The factual matrix of the said case has been narrated at paragraph 4 of the said Judgment, where also, there was no dispute that at the time when the goods in question were received in the factory of production, the same were covered by all requisite documents including the triplicate copy of Bill of Entry, but subsequently, triplicate copy of Bill of Entry was misplaced and as such, the assessee therein, obtained the exchange control copy of the relevant Bill of Entry from the bank and produced the same before the Central Excise Authority concerned. 24. Here, in the case in hand, almost a similar situation was prevailing where, the goods imported were received in the factory of production and the same were covered by the requisite documents including the triplicate Bill of Entry which was lost subsequently and in lieu thereof, the assessee had produced duly attested / certified photocopy of the triplicate Bill of Entry. 25. The only difference between the ....
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.... (ii) 2009 (241) E.L.T. 31 (M.P.), Union of India Vs. Kataria Wires Ltd. 29. In the first case, i.e., 2002 (140) E.L.T. 370 (MP), (cited supra), the issue was that, the assessee therein claimed MODVAT credit by producing certified copy of the Bill of Entry. Since the MODVAT credit was disallowed by the original authority, the assessee preferred an appeal before the CEGAT against the disallowance of MODVAT credit on the ground that the reconstructed triplicate copy of the Bill of Entry, cannot be considered as a valid document for availment of MODVAT credit. 30. Considering the said case, the CEGAT found the issue infavour of the assessee as against which Revenue carried the matter to the High Court of Madhya Pradesh, where the Division Bench of the said High Court has held as follows: "6. We have gone through both the orders, perused the record. In our considered opinion, no question of law arises in this matter for consideration of this Court. The CEGAT has recorded a finding that respondent No.1 had actually submitted the Bill of Entry in triplicate in original at the time of taking the Modvat credit but subsequently it was lost, on account of shifting of off....
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....in the order passed by the CESTAT. Accordingly, we do not find that the case involves any substantial question of law, much less the question formulated by the appellant. The appeal is dismissed summarily." 34. Now, let us move on to assess, as to whether the principles and findings given by various High Courts in the aforesaid three Judgments (cited supra) cited by the side of the assessee, can be made applicable to the facts of the present case. 35. In the present case, the original Assessing Authority by his order dated 23.9.1994, has recorded that, 'the assessee were given time upto 20.8.94 to give reply and produce all the evidences, in connection with this issue vide this Office letter under C.No.IV/16/257/94,UCD dated 8.8.94. And, the assessees responded by submitting the photostat copy of the original certified copy of Bill of Entry in question, duly certified by the Customs, as the original one was lost during transit vide their letter dated 17.8.94 and, in as much as they have produced the copy of the document in question, they contended that the availment of Modvat Credit on the impugned goods covered by the said document is right and, therefore, requested for ....
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....n by the Division Bench of the Allahabad High Court in the aforementioned Judgment 2015(324) E.L.T.264 (All) (cited supra) would squarely apply to the case on hand. 41. The aforesaid two Judgments of the Madhya Pradesh High Court also would support the legal position articulated by the Allahabad High Court, in MATSUSHITA TELEVISION & AUDIO INDIA LTD case. 42. At the same time, the learned counsel appearing for the Revenue, has relied upon three Judgments of different High Courts, which have been referred to above. Therefore, let us take up those Judgments also and examine. 43. The first Judgment is 2013 (293) E.L.T. 208 (All.)(cited supra) of the Allahabad High Court. In the said Judgment, the fact remains that, in that case MODVAT credit was denied by the Assistant Commissioner of Central Excise, Mirzapur on the ground that, the words, 'duplicate invoice' was not mentioned in the invoices and in one invoice, the portion showing the words, "original and duplicate," was torn and according to Rule 57G of the Rules, as it stood during the relevant period MODVAT credit could have been allowed only on furnishing of duplicate invoice and not otherwise. 44. The followi....
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....es not strictly comply with the said rule but contains the details of payment of dues, description of goods, assessable value etc. 46. Therefore, the principles which can easily be culled out from the aforesaid Judgment is that, the aspects mentioned in Rule 57G, especially in the context of filing documents to claim MODVAT credit is procedural and if at all there is any lacuna on the part of the assessee in complying with these procedural requirements of filing documents that would not affect the substantive right of the assessee to claim MODVAT credit. 47. In this regard, the relevant portion of the clarificatory notification issued by the Revenue in Circular No. 441/7/99 CX dated 23.2.1999, is extracted hereunder: "2. The Assistant Commissioner, before issuing Show Cause Notice for wrong availment of Modvat credit by the assessee on any procedural grounds, shall conduct enquiries with regard to duty paid nature of the goods as the suppliers send, ensure that necessary information as mentioned in the Notification are available on the invoice and satisfies himself whether the goods have been used or are intended to be used as contemplated in the Modvat Rules. In cas....
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....nd disputed. Therefore, on the basis of the said factors of the case, in the context of Circular instructions given by the Government of India, Ministry of Finance (Department of Revenue), Central Board of Direct Taxes, New Delhi in Circular No.68/68/94-CX, dated 24.10.1994, the Division Bench, has decided the issue in favour of the Revenue. However, the fact situation and the context under which, such a decision was made by the Division Bench, can be easily noticed, as it has been recorded in paragraph 5 of the Judgment. The case of the assessee in that case to claim MODVAT credit on the basis of original bill as he lost its duplicate invoice, was negated, only in view of the circulars issued by the Revenue. Inorder to have a better appreciation, paragraph 5 of the said Judgment are reproduced hereunder: "5. Furthermore, the circular instructions issued by the Government of India, Ministry of Finance (Department of Revenue), Central Board of Direct Taxes, New Delhi in Circular No.68/68/94-CX, dated 24.10.1994, read as follows (para 4): "4. The credit can be availed only on the duplicate invoices issued under Rule 52A or Rule 57GG and the original invoices can be ....