2023-VIL-1072-CESTAT-AHM-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Rule 9(1)(b) of CENVAT Credit Rules 2004 - availment of credit on supplementary invoice – Admissibility of Cenvat credit by the job worker based on supplementary invoices issued by principal paying differential duty – Denial of credit invoking Rule 9(1)(b) of CENVAT Credit Rules, 2004 – assessee case that since the appellant being a job worker received the goods not as a purchase, but on returnable basis for job work and no sale is involved, the provision of Rule 9(1)(b) of CENVAT Credit Rules is not applicable – HELD - Under Rule 9(1)(b) of CCR, 2004 restriction of availment of credit on supplementary invoice is applicable in a case where the manufacturer supplier of inputs or capital goods not paid the duty or short paid the duty by reason of fraud, collusion or any wilful mis-statement or suppression of facts or contravention of any provision of the Act or Rules made thereunder with intend to evade payment of duty only when such clearance is in the nature of sale of goods. In the present case, the appellant is a job worker and they have received the goods on which CENVAT Credit was taken as a job worker, for the purpose of job work on behalf of principal on returnable basis for job work - the transaction is clearly not covered under ‘sale’ of goods - the combined reading of Rule 9 (1)(b) and Section 2(h), it is clear that only in a case of sale of goods, the restriction of CENVAT Credit on supplementary invoice is applicable. In the present case, the transaction being not a sale transaction the restriction shall not apply - appellants are entitled to the CENVAT Credit on the strength of supplementary invoices issue by principal – further, no penalty can be fastened under Rule 26 (2) of Central Excise Rules, 2002 on the principal as it has rightly issued the supplementary invoice towards the payment of differential duty and the said issuance of the supplementary invoice is not illegal or incorrect - the impugned order is set aside and appeals are allowed
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