CESTAT Quashes Denial of CENVAT Credit of Excise Duty on Import of Welding Machines on ground of Absence of Proper Evidence [Read Order]

The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the denial of CENVAT Credit of excise duty on the import of welding machines on the grounds of absence of proper evidence. 

Kanade Anand Udyog Pvt Ltd, the appellant assessee was engaged in the import of welding machines and appealed against the denial of CENVAT credit of excise duty. 

Neerav Mainkar, the counsel for the assessee contended that proceedings initiated by notice were made in the specific context of the factory having ceased to function by the time of the audit visit in August/September 2008 and absence explained away as owing to the transfer of the machinery to sister units, as well as deployment of spares and consumables, and challenge to the allegation of not having been incorporated in the returns filed with the Commissioner of Income Tax. 

P K Acharya, the counsel for the department relied on the decisions made by the lower authorities and contended that the denial of CENVAT credit was as per the law and liable to be sustained. 

The Bench observed that Under the scheme of CENVAT Credit Rules, 2004, taking of credit was permitted on receipt of goods in the factory, subject to such variations as permitted therein, and not to be denied if availed against proper documentation. 

The two-member bench comprising Ajay Sharma (Judicial) and C J Mathew (Technical) quashed the denial of CENVAT credit due to the absence of supporting evidence while allowing the appeal filed by the assessee. 

To Read the full text of the Order CLICK HERE

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