Madras HC: Freedom of Religion Cannot Extend to Disturbing Peace Within Temple Premises  ||  Delhi HC: Lokpal Cannot Form a Prima Facie View on Corruption Without Hearing The Official  ||  MP High Court: DRT Cannot Restrict or Impose Conditions on a Person's Foreign Travel  ||  Bombay HC: Results of Dec 2 And 20 Local Body Election Must be Declared Together  ||  Delhi HC: Employment Disputes Cannot be Treated as Commercial Cases under the Act  ||  Supreme Court: Divorced Muslim Woman Can Reclaim Gifts Given to Husband at Marriage  ||  Supreme Court: Police and Courts Should Act as Initial Filters to Prevent Baseless Prosecutions  ||  SC: Maharashtra Can Acquire Land under Slum Areas Act, Respecting Owner's Preferential Rights  ||  Supreme Court: Excise Exemption on Cotton Fabrics is Denied if Any Related Process Uses Power  ||  NCLAT: IBC Auctions are Not Ordinary Contracts, and Market Volatility Does not Excuse Bid Defaults    

Vishal Presicsion Steel Tubes & Strips Pvt. Ltd. Vs. The Commissioner of Central Excise - (Customs, Excise and Service Tax Appellate Tribunal) (14 Dec 2023)

Once the duty on final products has been accepted by the department, CENVAT credit availed need not be reversed, even if, the activity not amount to manufacture

MANU/CB/0120/2023

Excise

In facts of present case, the Appellant is engaged in the manufacture of excisable goods viz. Electric Resistance Welded (ERW) Steel Tubes. They availed cenvat credit on the inputs imported and used in the manufacture of finished goods as well as cleared the inputs 'as such' on payment of appropriate duty.

Alleging that the appellant had availed irregular cenvat credit on the imported goods and cleared as such as the said tools neither inputs nor capital goods used in or in relation to the manufacture of their final products, hence show-cause notices were issued to them demanding duty of Rs.75,32,305 and Rs.18,49,511 respectively, with interest and also proposing penalties under Rule 15(1) of Cenvat Credit Rules, 2004. On adjudication, demands were confirmed with interest by the Commissioner, who in turn, rejected their appeal. Hence, the present appeal.

In the present case, the appellants are engaged in the manufacture of various high precision tools, and also import certain parts used as inputs. The tools were customised and sold by the appellant on payment of appropriate duty of excise on its transaction value, which was more than the credit availed on the inputs. The Revenue disputed the processes undertaken on the imported items alleging the same do not result into manufacture of a new item different from the inputs; hence the activity undertaken by the appellant is purely in the nature of trading; therefore, cenvat credit availed on the inputs cannot be admissible.

The issue is no more res integra as it has already been settled by various decisions. Bombay High Court in the case of CCE Vs. Ajinkya Enterprises observed that, once the duty on final products has been accepted by the department, CENVAT credit availed need not be reversed even if the activity docs not amount to manufacture. In view of the settled principle of law, there is no merit in the impugned order. Consequently, the impugned order is set aside. Appeal allowed.

Tags : DEMAND   CONFIRMATION   LEGALITY  

Share :        

Disclaimer | Copyright 2025 - All Rights Reserved