By TIOL News Service

ALLAHABAD, AUG 31, 2015 : 'WHETHER on the facts and circumstances, the modvat credit can be taken on the basis of the photo-stat copy of BOE?'

The above was the substantial question of law that was before the High Court in an appeal filed by the CCE.

The counsel for the Revenue submitted that in view of the provisions of Rule 57G(3) of the CER, 1944, modvat credit was not admissible to the respondent.

The respondent submitted that neither the receipt of the goods in question in the factory of production under the cover of valid documents is disputed nor it has been disputed by the Central Excise Authorities that the goods have been used for the intended purpose in the factory of production.

Inasmuch as the findings recorded in the impugned order of the Tribunal are findings of fact and, as such, no substantial question of law arises.

The High Court observed -

+ There is no allegation in the SCN that the goods in question were not received under the cover of the relevant documents and that the goods were duty paid.

+ The stand taken by the assessee that the triplicate copy of the relevant bill of entry was misplaced, was also not disbelieved either by the Assistant Commissioner or by the first appellate authority. Since the triplicate copy of the bill of entry was misplaced and, as such, the assessee obtained from the bank the exchange control copy of the relevant bill of entry and filed the same along with various other documents. The said authenticated exchange control copy of the bill of entry obtained by the assessee from the bank could have been easily verified by the authorities. It is not the case of the appellant that the said document was not verifiable.

+ The findings of the Tribunal that neither the receipt of the goods in the factory under the cover of valid documents nor their use for intended purpose nor its duty paid nature has been doubted by the department, are findings of fact.

+ The Tribunal has also recorded a finding of fact that the modvat credit has been taken by the assessee on the strength of the specified document which got misplaced afterwards . These findings of fact have not been disputed by the appellant even before us.

+ Bare reading of Sub Rule (3) of Rule 57G clearly indicates that no credit under Sub Rule (2) shall be taken by the manufacturer, unless the inputs are received in the factory under the cover of any of the specified documents. In the present set of facts it is undisputed that the inputs were received in the factory under the cover of a triplicate copy of the bill of entry which was subsequently misplaced.

Holding that there is no merit in the Revenue appeal, the question of law was answered in favour of the assessee and against the appellant.

The appeal was dismissed.

(See 2015-TIOL-2003-HC-ALL-CX)