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of <h1>Appellant wins appeal on assessable value and scrap levy exemptions, penalties waived.</h1> <h3>CRI Pumps Pvt. Ltd. Versus CCE & ST, Coimbatore</h3> The Bench ruled in favor of the appellant on all issues. It was decided that handling charges and postage should not be included in the assessable value, ... CENVAT credit - whether appellant not manufacturing the exempted goods, the scrap and waste generated in the course of such manufacture shall render the appellant liable to a percentage levy u/r 6 (2) of the CCR, 2004? - Held that: - Law is very clear that the rule has application where an assessee manufactures both dutiable final product as well as exempted final product. But in the present batch of appeals, appellant has not at all manufactured any exempted final product - What that was the outcome in the course of manufacture of dutiable final product was scrap. Therefore, applying the first principle of law, scrap generated not being exempted goods manufactured, that is totally ruled out from scope of application of Rule 6 (2) of CCR, 2004. When the appellant succeeds on the first principle of law, there is no need to make any further enquiry - appeal allowed - decided in favor of appellant. Issues:1. Whether handling charges and postage form part of the assessable value.2. Waiver of penalties imposed in the batch of appeals.3. Liability to a percentage levy under Rule 6 (2) of the Cenvat Credit Rules, 2004 for scrap and waste generated.Issue 1: Handling Charges and Postage in Assessable Value:The appellant argued that the handling charges and postage should not form part of the assessable value. Referring to a previous order, the Bench agreed that post-clearance expenses like handling charges and postage are not mandatory for clearances and thus should not be included in the assessable value. Consequently, penalties imposed were waived in line with the legal position established in the previous order. The Bench decided to pass a similar order for the current batch of appeals, waiving the penalties imposed.Issue 2: Waiver of Penalties:The Revenue did not contest the appellant's proposition regarding the inclusion of handling charges and postage in the assessable value. After hearing both sides and examining the record, the Bench found that the appellant's submission aligned with the previous order and decided to waive the penalties imposed in all ten appeals listed.Issue 3: Liability for Percentage Levy on Scrap and Waste:The dispute in the second batch of appeals centered on whether the appellant, not manufacturing exempted goods but generating scrap and waste, was liable for a percentage levy under Rule 6 (2) of the Cenvat Credit Rules, 2004. The Bench clarified that Rule 6 (2) applies when an assessee manufactures both dutiable and exempted final products. Since the appellant only produced dutiable final products and the scrap was a byproduct of this process, not related to exempted goods, Rule 6 (2) did not apply. Following this legal principle, the Bench allowed all seven appeals in the second batch, as the scrap generated was not from exempted goods, thereby excluding it from the rule's scope.In conclusion, the Bench waived the penalties in both batches of appeals and ruled in favor of the appellant regarding the exclusion of handling charges and postage from the assessable value and the inapplicability of Rule 6 (2) to scrap generated from the manufacture of dutiable final products.
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