2018 (6) TMI 1433

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....anki, Rajasthan. Since the orders deal with a common issue, both the appeals are disposed off through this common order. 2. The appellant is engaged in the manufacture of tyres. They procure bought out items such as flaps, tube and 'O' ring. Such flaps, tubes and 'O' rings are cleared along the tyres in the form of sets. The appellants availed Cenvat Credit of the excise duty paid on tube/ flap/ O 'rings' and discharged excise duty on the sets consisting of tyre, tube as well as flap. The tyres manufactured by the appellant are also cleared without the flap, tubes etc. During the period under dispute i.e. September 2009 to July 2014, the Department noticed that the appellant availed the Cenvat Credit of various common input services such....

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....s discharged by the appellant on the sets at the time of clearance by including the value of bought out tubes/flaps etc. He brought to our notice the decision of the Tribunal in the appellants own case Balkrishna Industries Ltd. V/s Commissioner of C. Ex., 2007 (227) ELT 228 Tri.-Del) in which the Tribunal has taken the view that the tubes/ flaps etc are in the nature of accessory of final product. The Tribunal in the said case allowed the Cenvat Credit on the tubes and flaps. He argued that there is no case of Revenue that the Cenvat Credit on the flaps/ Tubes etc are not allowable and hence his submission was that the activity of procurement of tubes and flaps and selling the same along with tyre cannot be considered as an activity of tra....

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....ed as trading. 7. In the rejoinder the Ld. Advocate submitted that the decision of the Hon'ble Kerala High Court was given in a different context in which the tubes/flaps purchased by the assessee were sold by paying excise duty lesser than credit availed thereon. Consequently, he submitted that the decision is not relevant for the present dispute. 8. Heard both sides and perused the record. 9. The crux of the dispute in the present case is whether the appellant is required to pay an amount as required under Rule 6(3) (i) of the CCR, 2004. It is not in dispute that the appellant has availed Cenvat Credit on various input services and utilized the same for making payment of excise duty on their finished products. They have procured ....