By TIOL News Service

MUMBAI, DEC 16, 2017: CENVAT credit availed by the appellant on the strength of the document issued to it by Bhilai Steels Ltd. was denied as the same could not be produced before the authorities concerned, having been seized by the Income Tax department on 06.01.1994.

A SCN was issued to the appellant on 8.11.1994 for examination of that document. An attested copy was produced before the adjudicating authority for his examination. In the meantime, there was also change in the name of appellant which was explained to the said authority. Without considering these aspects and without causing any enquiry from the Income Tax Authority, the credit claimed by the appellant was denied.

The matter is before the CESTAT in the second round of litigation.

After hearing both sides and perusing the records, the Member (Judicial) observed –

"4. The controversy aforesaid could have been examined causing enquiry from Income Tax Authority since such defence was taken by appellant before that Authority. Onus of proof was discharged by the appellant. Therefore Revenue failing to cause enquiry to ascertain truth from the Income Tax Department shall not debar the appellant from respective claim of cenvat credit…."

The appeal was allowed.

(See 2017-TIOL-4428-CESTAT-MUM)