CESTAT allows Cenvat Credit of Excise Duty Paid for Mild Steel Scrap on Strength of Invoices issued by Registered Dealers

The CESTAT allowed the company to avail Cenvat Credit on the excise duty paid for the purchase of mild steel scrap, based on invoices issued by registered dealers. The company had been denied the credit earlier, as the department questioned the authenticity of the transaction. However, CESTAT held that the mere questioning of a dealer’s credibility does not invalidate the buyer's right to claim credit if the transaction is legitimate and supported by valid documentation. This ruling reinforces the importance of proper documentation and fair treatment of businesses that rely on third-party dealers in their transactions.