2017 (1) TMI 1310

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....Additional Commissioner has been upheld. The Order-in-Original dated 31.3.2009 confirms the demand of central excise duty of Rs. 44,72,544/- including cess along with interest against the appellant, and equivalent penalty has also been imposed on them. 2. The matter mainly pertains to the following issues: (i) Whether for deciding the eligibility of SSI appellant exemption value of chassis supplied by the customers are to be included in aggregate value of clearances for home consumption or not? (ii) Whether the appellant is entitled to cum-duty benefit, where they had not collected excise duty from their customers? (iii) Whether the appellant would be entitled to facility of CENVAT credit on the inputs used in ....

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.... (iii) Serial No.214 in the Table attached to the Notification No.6/2002-Central Excise dated 1.3.2002 has specified that the value of the vehicles shall be the value of vehicles excluding the "value of the chassis used in such vehicle ." (iv) So, as per the Notification No.8/2003-Central Excise, Circular No.733/49/2003-CX, dated 6.8.2003, the value of the chassis is not to be included and appellant has rightly availed the exemption from the excise duty. 4.1 Learned Chartered Accountant further , inter alia submits as under: (i) For the period when the appellant is not eligible for SSI exemption , they are eligible to claim CENVAT credit on the inputs used in the manufacture of all the goods from 2006-07 onward....

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....as below: " 3.  For the purposes of determining the aggregate value of clearances for home consumption, the following clearances shall not be taken into account namely:- (a)  ..... (b)  clearances of the specified goods wich are used as inputs for further manufacture of any specified goods within the factory of production of the specified goods" (c) ..... The appellant being engaged in the manufacture of auto body building they receive duty paid chassis from their customer on which they mount body/fabricated structures /equipment as per requirement of the customer. In terms of Para 3 of the Notification 8/2003 (supra) and Notification 6/2002-Central Excise (supra), the value of chassis s....

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....ture, once they crossed the SSI exemption limit. When there is payment of duty for the goods manufactured, there cannot be any reason not to offer the facility of CENVAT credit for the inputs used for such manufacturing. CENVAT credit is available for all the manufacturers who are paying central excise duty on the manufacturing. Therefore, the present appellant also cannot be an exception in this regard. Once the appellant has crossed the SSI exemption benefit and starts paying central excise duty on their manufacturing they would be entitled to the facility of CENVAT credit on the inputs used for their manufacturing. The CESTAT, Delhi in the case of Decent Foods (P) Ltd. (supra) held that when the assessee has been denied the SSI benefit a....