Rejected Goods

[SURYAKANT MITHBAVKAR]

We have purchased some old machine (Capital Goods) from our customer and after taken as input avail cenvat credit.

After modification in the same machine can we sell to our other customer mentioning same machine name which we have taken as input.

AI Summary

Sale of Modified Machinery Requires New Product Treatment for Excise Duty; Follow Rules 16A, 16B, 16C to Avoid Issues. A query was raised regarding the sale of modified old machinery, initially purchased as capital goods with CENVAT credit availed. The response clarified that upon selling the modified machinery, it must be treated as a new product for Central Excise duty purposes, based on the transaction value without reducing it for being old. It was noted that the procedures under Rules 16A, 16B, and 16C of the Central Excise Rules, 2002, should be followed to avoid audit objections.