Cenvat credit on complementary promotional items was denied because they were not inputs or packing material in manufacture.

Cenvat credit was held inadmissible on Boomer Tattoos/Printed Transfers supplied only as complementary promotional items, because they were not used as inputs or as packing material in manufacture of the final product. Applying earlier Tribunal precedent, the items did not meet the requirement of eligible input for credit. Once credit was found inadmissible, recovery of the taken credit with interest and penalty followed under the applicable Cenvat and excise provisions, and the demand was upheld in favour of Revenue.

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Issues: Whether Cenvat credit was admissible on Boomer Tatoos/Printed Transfers supplied as complementary items, and whether the credit already taken was recoverable with interest and penalty.

Analysis: The goods in question were found to have been supplied as complementary items and not used as packing material or as inputs in the manufacture of the final product. In view of the earlier decision in the assessee's own case, reiterated in later Tribunal precedent, such items did not satisfy the requirement of eligible input for Cenvat credit. Once the credit was held to be inadmissible, the consequential demand of reversal with interest and penalty followed under the applicable Cenvat and excise provisions.

Conclusion: Cenvat credit on the Boomer Tatoos/Printed Transfers was held inadmissible, and the demand for recovery of the credit with interest and penalty was upheld in favour of Revenue.

Ratio Decidendi: Goods supplied only as complementary promotional items, and not used as inputs or packing material in manufacture, are not eligible for Cenvat credit.

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