The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the order passed by the Commissioner (Appeals) for reversing the CENVAT credit under rule 3(5B) of the CENVAT Credit Rules, 2004 without considering the documentary evidence.
Owens Corning India Ltd, the appellant assessee was engaged in the manufacture of glass fiber, chopped strand mats, roving of glass fiber, etc., and availing CENVAT credit in respect of inputs, capital goods, and input services used with the manufacture of final products and the Commissioner rejected the availment of CENVAT credit.
The assessee appealed against the order passed by the Commissioner (Appeals) for imposing penalty and interest for non-payment of CENVAT Credit.
Rajesh Ostwal and Payal Nahar, the counsels for the assessee contended that the assessee had not physically removed the inputs from the factory and had made provisions for the inventory in the balance sheet only for income tax purposes and therefore the CENVAT credit was not required to be reversed by them.
Further submitted that the order passed by the Commissioner (Appeals) was not as per the law and without verifying documentary evidence filed by the assessee. Thus the order passed by the Commissioner was liable to be deleted.
SBP Sinha, the counsel for the department contended that the assessee failed to produce any documentary evidence in support of their claim/submissions and therefore their claim had been rightly rejected by the lower authorities.
The bench observed that the adjudicating authority passed the order without verifying the documentary evidence and it was necessary to give sufficient opportunity to the assessee for filing the relevant documentary evidence for supporting the claim.
A single-member bench comprising Ajay Sharma (Judicial) held that quashed the order and remand the matter back to the Commissioner (Appeal) for a fresh decision after giving sufficient opportunity to the assessee for placing on record the documentary evidence in support of their claim.
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