MAHALAXMI EXTRUSIONS Vs. COMMISSIONER OF CENTRAL EXCISE, RAJKOT

JUDGEMENT

(1.) THE relevant facts of the case, in brief, are that the appellants are engaged in the manufacture of Brass Rods classifiable under Chapter 74 of the Schedule to the Central Excise Tariff Act 1985. They placed order to M/s. MIR Metals Trading L.L.C. Dubai and M/s. A.R.A. Trading (L.L.C.) Dubai for supply of Re -melted Brass Ingots/Brass Ingots. The said companies entered into contract with M/s. Mitesh Impex, Jamnagar, for purchase of the Brass Ingots and the goods would be delivered to the appellant. Accordingly, M/s. Mitesh Impex supplied the goods to the appellant under cover of Central Excise invoice in the name of said Companies and deliver to Mahalaxmi Extrusions, Jamnagar (i.e., appellant), who availed Cenvat Credit on the basis of said Central Excise invoices.

(2.) A show cause notice dtd. 14.2.2006 was issued by the Joint Commissioner, Customs and Central Excise proposing to deny Cenvat Credit amounting to Rs. 14,34,980/ - alongwith interest and to impose penalty for the period Feb. 2005 to July 2005. It has been alleged that the appellant availed Cenvat Credit on the basis of the invoices, which are not valid documents in terms of Rule 9 of Cenvat Credit Rule 2004. It has further been alleged that as per Rule 3 read with Rule 9 of the said Rule 2004, Cenvat Credit is available only to the person, to whom the goods have been sold by the manufacturer and not to any other person. It is mandatory that the person in whose name the invoice has been issued, can take credit. The Adjudicating Authority disallowed the cenvat credit of Rs. 14,34,980/ - alongwith interest and also imposed penalty of equal amount of Cenvat Credit under Rule 15 of the Cenvat Credit Rules 2004. By the impugned order, the Commissioner (Appeals) modified the adjudication order in so far as penalty imposed on the appellants was reduced to Rs. 50,000/ - under Rule 15 of the Cenvat Credit of the said Rules. The Ld. Advocate on behalf of the appellant submits that there is no provision in the Cenvat Credit Rules that the credit would be eligible only purchaser of the goods from the manufacturer of inputs. He submits that Rule 9 of the said Rules provides the documents. In the present case, the appellant's name is mentioned in the invoices and the goods were delivered to the appellant. In support of their contention, the appellant filed Miscellaneous application for additional documents to substantiate that the appellant received the goods in their factory and utilised in the manufacture of the final products, which were cleared on payment of duty. It is submitted that the Central Board of Excise and Customs by circular No. dtd. 12.9.1995 clarified the procedural relaxation regarding the Cenvat Credit on inputs supplied for job worker. It is also relied upon the Board circular No. dtd. 4.6.1996 regarding the Modvat Credit on transit sale. He relied upon the decisions of the Tribunal as under:

(3.) ON the other hand, the Ld. Authorised Representative on behalf of the Revenue reiterated the findings of the Commissioner (Appeals). He submits that the appellant purchased the goods from the Dubai companies and the invoices were issued in their name. Rule 9 of the Rules 2004 clearly stipulates that credit would be eligible on the basis of invoices issued by the manufacture of inputs, who had purchased the goods. It is submitted that in some cases payment of duty has made by the appellant himself to the supplier of the ingots.