2017 (1) TMI 157

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....xcisable goods.  The appellants buy plastic sheets in bulk and cut the same into required size, print the name and logo etc. as required by their customers and laminate /metalize the sheets.  After this process, the goods are cleared in the roll form (CETH 39206912) on payment of excise duty.  The assessee cleared the finished goods to DTA on payment of duty and also exported them under LUT.  The appellants were availing the facility of CENVAT credit on inputs.  With effect from 01/03/2008, a clause in Chapter Note 16 of Chapter 39 of CETA 1985 was inserted stating that for goods falling under CETA 3920/3921, the process amounts to manufacture.  They were then issued show-cause notice for the period 01/04/2007 ....

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....le High Court of Delhi and vide decision laid in CCE, Delhi-II Vs. Sheetal Mercantile (P) Ltd. [2015(315) ELT 540 (Del.)], the Hon'ble High Court maintained the decision passed by the Tribunal dismissing the appeal filed by the Department. 4.  On behalf of the Department, learned AR Shri Nagaraj Naik and Shri Arun Kumar submitted that the process does not amount to manufacture prior to 01/03/2008 and therefore the assessee is not eligible for credit.  The learned AR submitted that the appeal No.E/154/2009 is filed by Department challenging the order passed by Commissioner who allowed the credit of Rs. 26,93,931/- in favour of the assessee.  He urged that when the process does not amount to manufacture, the Commissioner ought....

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....s manufacture has been set to rest by the amendment brought forth in CETA, 1985.  The assessee was under bona fide belief that the process undertaken by them amounted to manufacture.  They took registration, paid excise duty and also availed credit on inputs.  The Department was collecting the excise duty paid by assessee.   The assessee can utilize this credit taken prior to 01/03/2008 for paying the duty on the products which have become excisable after 01/03/2008.  In this regard, the observations made by the Tribunal in the case of Markwell Paper Plast Pvt. Ltd. (supra) is noteworthy.  Relevant para is reproduced under:- 23.    Even otherwise if for the sake of argument it is assumed that th....