Brilliant Order passed by young Assistant Commissioner Ruchi Bisht

By Vijay Kumar

THIS column cannot end today without expressing its unbounded admiration for a bold and brilliant order passed by a young IRS officer on the issue of credit on courier bill of entry.

During the course of audit, it was observed that the assessee had availed CENVAT credit on the basis of combined courier bills of entry and in terms of the clarification issued by the CBEC in Circular No.No.31/2007 (Customs) dated 29-08-2007, the assessee was required to file Normal Bill of Entry, which serves as the document for claiming CENVAT. Thus, it is alleged that combined courier bills of entry on the basis of which the cenvat credit was availed by the assessee was not the valid document for the purpose of availing cenvat credit in terms of Rule 9 of the CCR, 2004. On this ground, the cenvat credit availed by the assessee was treated as inadmissible and its recovery was proposed along with interest and invoking penal provisions.

The Assistant CommissionerRuchiBisht who adjudicated this case did not agree. She observed,

On going through the relevant provisions of Rule 9(1)(a) to Rule 9(1)(g) of CCR, 2004, I find that the said provisions actually describe the type of documents on the basis of which the cenvat credit shall be taken by the manufacturer or output service provider. I find that sub-rule 9(1) c of the said Rule prescribes " a bill of entry" as the valid document for availing cenvat credit. I also find there are no restrictions under the said Rule with regard to type of bill of entry for the purpose of availing cenvat credit. I also find that the expression "a bill of entry" occurring under the said Rule 9(1)(c) does not limit the scope of a document for imported goods to an original or duplicate copy of normal bill of entry and also that a bill of entry filed through a courier was not covered under Rule 9(1 )(c) of the Cenvat Rules. I would also like mention the provisions of sub-rule (2) of Rule 9 ibid which prescribes particulars to be contained in these documents to make them valid documents for availing the cenvat credit. ……

From the above legal provisions, it is amply clear that if the document contains basic details about duty payment, description of goods and if the goods covered under the said document are duly received and accounted for in the books of account of the receiver, the cenvat credit may be allowed even if the other requisite details are not available in the said document .

I would also like to go through the CBEC circular in question which is the only pillar on which the present show cause notice is based...

From the plain reading of the above CBEC circular it clearly emerges that the same is of clarificatory nature. The word "may' used therein also suggests that there was no compulsive restrictions imposed for use of combined courier bill of entry for availing cenvat credit thereon. I also find that there is no mention in this circular that a normal bill of entry was the only document that could be allowed under Rule 9(1)(c) of the Cenvat Rules for taking cenvat credit.

Since no dispute has been raised in the impugned show cause, it is also an admitted fact that the concerned imported goods were brought in their factory, they were accounted for in the books of accounts and they were used in relation to manufacture of final products cleared from factory on payment of appropriate excise duties by the said assessee. Thus, I find that all the basic ingredients of the Cenvat Scheme were fulfilled in this case.

Thus, from the above provisions and facts of the case; I find that as clarified by the Board, the normal bill of entry may have been used by the assessee for the purpose of availing cenvat credit instead of the combined courier bills of entry. However, considering the facts that the basic ingredients of the Cenvat Scheme were fulfilled in this case, there was only a procedural lapse on the part of the assessee for not filing the normal bills of entry for availing the benefit of cenvat credit in terms of the clarification given by CBEC.

I have no hesitation to hold that since all other provisions substantially complied with by the said assessee, there was no contravention on their part as alleged in the notice on hand and they were eligible to avail the cenvat credit in question on the basis of combined courier bills of entry being admissible to them.

This is the kind of orders that you expect from judicious officers. Ruchi Bisht is a 2010 batch IRS officer and she passed this order in 2013. It is really a brave and brilliant order from a young officer. She could have taken the normal path and confirmed the demand, but this young lady has passed an order that would stand judicial scrutiny. Very rarely you would see such ‘speaking orders' from Departmental officers. Actually such officers are the real assets of the department and the Nation as they contribute to avoidance of unnecessary litigation and waste of time and money of the department, the trade and the Courts. DDT wishes Ruchi Bishta bright and successful career in the department; we need more officers like her.