ORDER
R. Jayaraman, Member (T)
1. Though this day only stay applications were listed for hearing, after hearing both the sides, since the matter calls for a remand back to the adjudicating authority, we have, with the consent of both the sides, taken up the appeals themselves for disposal, granting waiver of pre-deposit of duty and penalty amounts.
2. Both the appeals are directed against the common Order-in-Original No 44 & 45 of 1995 (F. No.V-Adj (52)15-5/95, dated 15-11-1995 passed by the Commissioner II Central Excise, Bombay-I disposing of two show cause notices.
3. The issue relates to denial of Modvat credit taken on the basis of invoices issued by M/s. BPRL Assam and M/s. India Polyfibres Ltd., U.P. Inputs have been received from the aforesaid manufacturers after their transfer to their godown. Subsequently invoices were issued to their own dealers but the consignments are reported to have come directly to the appellants al-ongwith the invoices, on the basis of which Modvat credit has been taken, but the department objected to the availment of Modvat credit on the ground that the manufacturers invoices indicate sale to some traders and the traders have not in turn issued invoices. Since the traders’ invoices which are approved documents for purpose of availment of Modvat credit were not produced, credit was sought to be denied. Subsequently, they also obtained the invoices from the traders, which however have not been taken into account and the demands have been confirmed and penalties also have been imposed approximately equivalent to the credit availed of.
4. Shri AV Phadnis, the ld advocate for the appellants took us through the paper book filed to point out that BPRL have given a certificate indicating that the goods covered by the invoices indicated in the certificates have not been delivered to any other party other than the appellants M/s. Prakash Cotton Mills Ltd. Similar certificate has also been given by India Polyfibres Ltd.
He also refers to the invoices issued by the manufacturers indicating the removal of the goods in the first instance from the factory to their godown in Udaipur. He also refers to the packing list showing the goods covered by the invoices and also transfer challan for transfer of the goods from the factory to Udaipur. Lorry Receipts showing movement of the goods from the factory to Udaipur and thereafter to the appellants’ premises in Bombay have also been produced. Goods received in their premises are also listed in their packing slip. These particulars tally with the original packing slip. Merely because the godown issued invoices in the name of Karan Traders who are their selling agents for purpose of giving commission, preponderance of evidence indicating movement of the goods through godown of the manufacturer to the appellants’ premises cannot be ignored for denying the substantive Modvat benefit. Even the technical omission of non-issue of invoice by Traders has been subsequently made good.
5. On a perusal of these documents, prima facie we find that the proper co-relation is discernible with regard to the goods moved from the factory upto the appellants’ premises. These evidence cannot be ignored merely on the technicality of non-production of invoices from the traders, especially when the manufacturer’s documents themselves show that the goods are meant for the appellants and they have not been sold to any other party. However, we find that these evidence have not been taken into account and the impugned order has been passed only on the ground that traders’ invoice is not forthcoming. In this view of the matter, we set aside the order and remand the case back to the Commissioner with direction that all these documents establishing proper co-relation of the movement of the goods from the manufacturers upto the appellants’ premises may have to be considered for taking appropriate view regarding the eligibility for Modvat credit. In view of these documents, if the traders’ invoice is not produced but produced subsequently, the technical requirement should be construed to be met. With this observation, we remand the case back to the Commissioner for considering these evidences, for purpose of establishing co-relation and if it is so satisfied, Modvat credit be extended.
Both the appeals and stay applications are disposed of in the above terms.