2005 (11) TMI 325

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....7-98 to Sept. '02, the appellants had taken Modvat/Cenvat credit of countervailing duty on the quantities of Copper concentrate samples drawn for testing. It appeared to the Department that these quantities were not used in, or in relation to, the manufacture of Copper anodes and hence Modvat/Cenvat credit on these quantities of input was not admissible to the assessee. On this basis, a show cause notice dated 25-2-2003 invoking the extended period of limitation was issued to the party asking them to reverse the above credit and proposing penalty on them. Upon receipt of this notice, the party reversed the credit taken on 80% of the total samples weight, which had been removed out of their factory for testing by an external agency (M/s SGS ....

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.... (iii)   Manali Petrochemicals Ltd. v. CCE, Chennai - 2004 (167) E.L.T. 434 (Tri.-Chennai). She has also supplied a write-up of conversion of Copper concentrate into Copper anodes, as also a detailed technical note on manufacturing process. Ld. SDR has reiterated the findings recorded by the lower authorities. 3. After considering the submissions, I find that both the lower authorities have denied to the assessee Modvat/Cenvat credit on the test samples in question on the ground that these goods were not used in, or in relation to, the manufacture of Copper anodes. They have found no evidence of these goods having been used in, or in relation to, the process of manufacture of Copper anodes in the appellants' factory. L....

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....le Sawyer Ltd. (supra), inputs used for quality testing as required under Drugs and Cosmetics Act, 1940 were held to be cenvatable. In the instant case, it has not been shown that the testing of input samples was done as per any statutory requirement. In the case of Kolsite Machine Fabrik Pvt. Ltd. (supra), goods used for the purpose of testing final product to ensure that such product conformed to the specifications of customers were held to be modvatable under Rule 57A of the Central Excise Rules, 1944. In the present case, the tests in question were not done on any final product. They were done on the raw material, and, that too, without maintaining the necessary registers and without establishing that such testing was an essential pre-r....