TaxTMI 
TaxTMI 
2018 (11) TMI 1205
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.... another SEZ Unit situated at Falta, Special Economic Zone, wherein also locknuts of different specifications, are being manufactured. The common input which is required for manufacture of locknuts is H.R.Coils of width 1260 mm, which is procured by the appellants from SAIL. The order is placed upon M/s SAIL through a commission agent, M/s Brahama Alloys, to cover the requirement for both the DTA Unit as well as SEZ Unit. H.R.Coils procured from SAIL, are directly sent to job workers for slitting the same into sheets of smaller width. The split sheets are received in Garia Unit (DTA Unit) and at the time of receipt of such sheets, cenvat credit is availed on the Excise duty paid on H.R.Coils. The job workers slit the coils into sheets of va....
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....icating Authority ordered reversal of the cenvat credit on the portion of H.R.Coils as well as service tax. This order has been challenged in the present appeal. 4. The appellant is represented by Shri Arvind Baheti, ld.C.A. and Revenue is represented by Shri K.Chowdhury, ld. D.R. 5. The arguments advanced on behalf of the appellant are summarized below : (i) The ld.C.A. for the appellant, submitted that the H.R.Coils procured from SAIL are used for the manufacture of locknuts. He submitted that such H.R.Coils are required to be split into sheets of proper sizes for use in the manufacture of locknuts. He argued that the inputs are procured commonly for DTA Unit as well as SEZ Unit. He submitted that a portion of sheets is cleared t....
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....onsequently, he submitted that the credit cannot be availed to the extent of the inputs, which are not intended for use in the DTA Unit as has been ordered by the lower authority. (ii) He submitted that the appellant has debited the cenvat credit proportionately to the extent of the sheets cleared to the SEZ Unit. But this cannot be considered as either expunged or reversed credit so availed, since the appellant has claimed rebate of the same under SEZ Regulations : (iii) He also relied upon the following decisions to support his arguments : (a) Ford India Private Ltd. Vs. CCEx., Chennai : 2007 (214) ELT 40 (Tri.-Chennai) ; (b) KCP Ltd. Vs. CCEx., Chennai : 2013 (295) ELT 353 (S.C.) ; (c) Bhor Industries Ltd. Vs. Union of Ind....
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....ating Authority has also observed that the DTA Unit is incapable of processing sheets of the size and specification sent to the SEZ Unit. 10. The entitlement to the Cenvat Credit as inputs is to be decided in the context of the definition with the term "input" as per Rule 2 (k) of the Cenvat Credit Rules, 2004. The definition of "input" includes all goods (subject to certain exceptions) used in or in relation to the manufacture of final product. The inputs on which cenvat credit has been claimed are H.R.Coils procured from SAIL. It cannot be said that such H.R.Coils are not used in or in relation to the manufacture of the final product i.e."locknuts". For use in the process of manufacture, there is a need to slit the H.R.Coils into sheet....