For procedural lapse benefit of CENVAT Credit cannot be denied as Duty payment under Invoice, receipt of input has not been disputed: CESTAT [Read Order]

The Mumbai bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), held that, For procedural lapse benefit of CENVAT credit cannot be denied as duty payment under invoice, receipt of input has not been disputed, so was held by.

The brief facts of the case are that during the course of EA-2000 Audit of the records of the appellant, M/s Navkar Corporation Limited were availing Cenvat Credit facility under the existing law (as defined in CGST Act 2017) and had availed the Transitional Credit facility granted to them under the provisions of the CGST Ac|,2017. The appellant, in terms of Rule 117 of the CGST Rules, assessee had filed Trans-1 as per table 7(b) under Section 140(5) the CGST Act for an amount of Rs.1,33,95,6761. The appellant had wrongly claimed the input tax credit on invoices received after the appointed date i.e., 1st July, 2017 in TRAN 1. From the records submitted by the appellant, it was observed that the appellant had utilized the services prior to appointed date and invoices received after appointed day, but the invoices were also dated before 30.06.2017.

Further, it was also noticed that out of total ITC credit of Rs,1,33,95,6761, the appellant was not eligible to transmit ITC credit for an amount of Rs.5,50,435/ – for the reasons that they had not produced invoices for verification at the time of audit, invoices not address to the assessee, invoices pertained to repairs of motor car, invoices pertain to personal use etc. The fact regarding the inadmissibility of the said wrongly availed Cenvat credit which was transited have contravened the above said provisions and it was brought to the notice of the assessee.

On being pointing out the said observation the appellant had communicated their disagreement to the objection and did not agree to pay the amount on account of Cenvat credit wrongly transited and the interest as applicable on the amount of Cenvat credit wrongly transited, as per Section 50.

Dhirendra Lal, Commissioner of Central Tax relied on the judgment in Pepsico lndia Holding P Ltd. Vs Commissioner of C,Ex , and held that “for procedural lapse substantial benefit of CENVAT credit could not be denied as the duty payment under invoice, receipt of input and use thereof has not been disputed “.

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