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April 2014

2014 (33) STR 376 (Tri-Delhi) Ester Industries Limited vs. CCE, Meerut –II

By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
Reading Time 1 mins
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Whether shortage of materials in an internal statement of stock taking is a ground for denial of CENVAT credit?

Facts:
The Appellant, a manufacturer of Polyester Films, availed the CENVAT credit on various inputs and capital goods. During the departmental audit, Revenue noticed shortage in raw materials as per internal stock statement and accordingly, demanded the duty to the extent of credit involved in the differential value of materials. The Appellant contended that there were no actual shortage and offered to provide the reconciliation.

Held:
The Tribunal observed that the entire case was on account of shortage of cenvatable inputs as per statement of the Appellant and there was no allegation or evidence that the said inputs were not received or cleared without duty payment, hence the order was set aside.

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