Duty credit on returned damaged glass upheld under Rule 16 for reprocessing and remaking purposes.

Rule 16 of the Central Excise (No. 2) Rules, 2001 was treated as broad enough to allow duty credit when duty-paid goods are returned to the factory for re-making, refining, re-conditioning or any other reason. On that reading, damaged glass returned after removal was covered by the rule, and the Tribunal relied on its earlier view that damaged or broken glass sent back for reprocessing fell within the concept of remaking under the corresponding earlier provision. Duty credit was therefore admissible on the damaged glass received back in the factory.

---

---

Issues: Whether duty credit was admissible under Rule 16 of the Central Excise (No. 2) Rules, 2001 on damaged glass returned to the factory.

Analysis: Rule 16 permits credit where duty-paid goods are subsequently returned to the factory for being re-made, refined, re-conditioned or for any other reason, and the expression used in the rule is broad enough to include damaged glass returned after removal. The Tribunal also drew support from its earlier view that damaged and broken glass returned for reprocessing fell within the concept of remaking under the corresponding earlier rule.

Conclusion: The appellants were entitled to duty credit on the damaged glass received back in the factory.

---