TaxTMI 
TaxTMI 
2000 (7) TMI 770
X X X X Extracts X X X X
X X X X Extracts X X X X
....ently found defective and were rejected by them. 2. Shri B.N. Chattopadhyay, learned Consultant for M/s. Coventry Spring & Engineering Co. Ltd. submits that they are engaged in the manufacture of Springs which were originally cleared by them on payment of duty. These Springs were found defective by their buyers and as such, were returned to them on payment of duty. They have taken the Credit of the said Duty paid by their suppliers on the rejected and returned goods, inasmuch as the same have been taken as inputs in their RG-23A, Part-I register. He also submits that thereafter, the goods were cleaned and stripped of paints and then the same were heated in the Heating Furnace at a temperature ranging between 850o to 1050o Ceritigrad....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Modvat Credit of Duty paid on such final, rejected and returned products. 4. Shri V.K. Chaturvedi, learned S.D.R. appearing for the Revenue submits that the final product has already been cleared from the appellants' factory on payment of duty. If the goods are found defective; there are other provisions of law under the Central Excise under which the goods can always be returned back to the appellants factory and after reprocessing, re-making etc., the same can be cleared without payment of duty, subject to observance of certain procedural requirements. As such, he submits that there is no justification for availing the MODVAT Credit of Duty paid on the final product by the receiver of the same, when the goods are returned back to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t be used as such and that is the reason why the same were returned by their customers. The detailed process undertaken by them, no doubt amounts to manufacture in terms of Section 2(f) read with Section Note (6) of Section-XVI of the Tariff. I also find that in the said Larger Bench decision, the Tribunal has taken note of the Circulars issued by the Board. It was observed by the Larger Bench that though the Circular was issued in the context of metal products which are melted for the manufacture of new products, the position in the case of metal containers which are dismantled and taken back to the original stage of metal sheets and then re-manufactured to new metal containers, is not indifferent. Accordingly, the Bench observed that the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....No. 30/95 dated 7-7-1995 issued by Jamshedpur Central Excise Commissionerate, wherein the Modvat Credit of Duty paid on the rejected goods received back by the assessee, is available. The Assistant Commissioner in his impugned Order has observed that the rejected Motor Vehicle Parts have only been re-conditioned by the appellants by some minor processes and have not been converted into new Motor Vehicle Parts and as such, no manufacturing process has taken place. The appellants in their Appeal Memo have contended that the processes undertaken by them for making the final product out of the rejected product, satisfy the definition of manufacture in terms of Section 2(f) of the Central Excise Act, 1944 i.e. any process incidental or ancillary....