TaxTMI 
TaxTMI 
2018 (9) TMI 1575
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....eless Terminals, with BSNL. The appellants in turn placed an order on ZTE, Corporation, China. The appellants also imported 49,940 "Power Supply Units" and have taken Cenvat credit of Rs. 41,21,917/-. They have been clearing a final product to M/s. BSNL as per the agreement. 2. The Department had issued a show-cause notice dated 05.10.2007 to the appellants contending that the activity of inspection and sample testing undertaken by the appellants does not amount to manufacture as no new commodity having distinct name, character or use emerges as a result of such processes; in terms of Rule 16 of Central Excise Rules 2002, the appellants ought to have paid an amount equal to the credit availed at the time of removal of such inputs on which ....
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....WT; Offering the IFWTs to the customer for their evaluation as per Customer's circle wise requirement; The selected samples put for vigorous quality check like temperature cycling at 50 degree centigrade from 72 hours in a special burn in chamber. Customer will monitor the condition of the IFWTs at the elevated temperature; customer will test the IFWT samples from their quality check in the CDMA Mobile phone tester; customer will check for these IFWTs in their live network for voice, SMS, Data and PC Fax communication. He also submitted that some of the instruments are rejected and ZTE Corporation was informed to take them back and as and when the supplier takes back the same, Cenvat will be reversed. This process amounts to manufacture. Th....
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....e cleared without bringing into the factory. 4. The learned Departmental Representative has reiterated the findings in the Order-in-Original and relied upon the following cases to say that the activities performed by the appellants did not amount to manufacture under Section 2(f) of Central Excise 1944. (i) Empire Industries Ltd.: 1985 (20) ELT 179 SC (ii) Sterlite Optical Technologies Ltd.: 2012 (282) E.L.T. 392 (Tri.-Ahmd.) He submitted that the testing etc. claimed by the appellants is done by the personnel of the purchaser i.e. BSNL in the premises of the appellant. Therefore, it cannot be held that the appellants are doing such processes although they do not amount to manufacture. 5. Heard both sides and perused the records of....
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.... purchase order, the manufacturing process is not complete, the machines are not fit for sale and hence not marketable at the factory gate. (paras 17 & 21) (Emphasis supplied). 5.2. Moreover, we find that the Central Excise Department is not very clear on the issue whether the processes undertaken by the appellants amounted to manufacture or otherwise. We find that the Department has not raised any issue with reference to manufacture by the appellants in a different case involving of a refund claim of Rs. 7,33,29,913/- for the period 2003-04 and 2004-05 (Appeal No. E/845/2008). In that case also the appellants were involved in similar activity. The only difference being that the foreign supplier was M/s LG Electronics in that case where as....