TaxTMI 
TaxTMI 
2016 (10) TMI 71
X X X X Extracts X X X X
X X X X Extracts X X X X
....rinted/un-printed cartoons, corrugated boxes (CFC) falling under Chapter 48 of Central Excise Tariff Act, 1985. A demand notice was issued to them on 24.03.2006 alleging that during the period 01.7.2001 to 31.3.2005, the Appellant had received back the finished goods rejected by their customers and availed credit as prescribed under Rule 16 of Central Excise Rules 2002 for the purpose of remaking, refining and reconditioning. However, later, these goods were cleared as scrap on payment of duty on the transaction value without reversing the credit. Consequently, a demand notice was issued for recovery of CENVAT Credit of Rs. 9,17,691/- on the returned goods cleared as scrap with a proposal for imposition of penalty. On adjudication, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ort, he has referred to the recent decision of Hon'ble Supreme Court in the case of CCE Jalandhar Vs M/s Royal Enterprises - 2016 (337) ELT 482 (SC). 5. The learned Authorised Representative for the Revenue, on the other hand, submitted that Rule 16 of Central Excise Rules 2002 is very clear that the Appellants are eligible to avail CENVAT Credit of duty paid goods in their factory when returned for remaking, refining and reconditioning or for any reason and utilisation of said credit in accordance with the CENVAT Credit Rules. It is also clear that in the event of process to which the returned goods are subjected, does not result into manufacture, then the Assessee is required to pay amount equal to the CENVAT Credit availed at the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....other reason, the assessee shall state the particulars of such receipt in his records and shall be entitled to take CENVAT credit of the duty paid as if such goods are received as inputs under the CENVAT Credit Rules, 2002 and utilise 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 under sub-section (2) of section ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... their factory. Also, in the said register, it is maintained invoice-wise and clearance of scrap is also reflected. Also, in the monthly returns, the Appellant had indicated that the clearances of defective materials on payment of duty by making a remark as "material resupplied against D-3". Therefore, in my opinion, all the facts are disclosed to the Department. The Hon'ble Supreme Court in the case of Royal Enterprises (supra) referred to its earlier judgment, observed at Para 4 as follows:- "4. Similarly, in the case of Pushpam Pharmaceuticals Company Vs Collector of Central Excise, Bombay [1995 (78) ELT 401 (SC)], it was held that mere omission to disclose the correct information would not amount to suppression of facts unl....