2015 (10) TMI 1700

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....equivalent penalty was also imposed upon the appellant under Rule 15 of the Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. 2. Shri V.N. Rane (Advocate) appearing on behalf of the appellant argued that the issue involved in the present appeal is admissibility of CENVAT credit on rejected finished goods, under Rule 16 of the Cenvat Credit Rules, 2004, which are meant for repair and reconditioning. It was his case that such rejected goods are entered into the statutory CENVAT credit account and are cleared either as rejected and repaired goods or as waste by discharging duty liability on transaction value as per the provisions of Rule 16 of the Cenvat Credit Rules, 2004. Learned Advocate relied upon the foll....

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....at the time of removal thereof are brought to any factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of such receipt in his records and shall be entitled to have CENVAT credit of the duty paid as if such goods are received as inputs under the Cenvat Credit Rules, 2002 and utilize this credit according to the said rules. (2) If the process to which the goods are subjected before being removed does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken under sub-rule (1) and in any other case the manufacturer shall pay duty on goods received under sub-rule (1) at the rate applicable on the date of removal and on the value determined un....

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....leared by the appellant emerged during the course of remanufacture or not. The provision of Rule 16 does not require maintenance of any records. The returned goods have to be treated as inputs and the assessee having shown the issuance of the said inputs from their RG-I; had deemed to have manufactured their final product. In the absence of any documentary evidence in support of revenues stand, I find no justification for setting aside the impugned order of Commissioner (Appeals). Revenues appeal is accordingly rejected." 4.2 So far as Rule 16 (2) is concerned the same is procedural and does not indicate maintenance of special records. In Para 7 of the reply to the show cause notice, as reproduced by Commissioner (Appeals) in Para 9 of h....