TaxTMI 
TaxTMI 
2019 (12) TMI 1122
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.... of irregular CENVAT credit of Rs. 90,89,714/- under Rule 14 of CENVAT Credit Rules, 2004 read with the proviso to Section 11A of the Central Excise Act, 1944 along with interest. 2. Briefly the facts of the present case are that the appellants are engaged in the manufacture of excisable goods viz., Brass Strips, Phosphor Bronze Strips and Copper Strips falling under Chapter Sub-heading 7409 2100, 7409 1100 and 7409 3100 of the First Schedule of the Central Excise Tariff Act (CETA), 1985. Appellants are also availing the CENVAT credit of duty paid on inputs in terms of Rule 3 of CENVAT Credit Rules, 2004. The department proceeded against the appellant by issuing show-cause notice dated 19.1.2009 alleging therein that the appellant had av....
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....dents. He further submitted that the following facts are not in dispute in the present case. (i) Appellants are engaged in the activity of cutting/slitting of Brass Strips, Phosphor Bronze Strips and Copper Strips falling under Chapter subheading 7409 2100, 7409 1100 and 7409 3100 of the First Schedule to the Central Excise Tariff Act, 1985; (ii) Appellants had availed CENVAT Credit of the duty paid on inputs received in coil form; (iii) Appellants, after converting the coils into strips by undertaking operations of slitting/cutting had cleared the finished goods viz., strips on payment of duty by utilizing CENVAT credit availed on the inputs as also in cash. 4.1 He further submitted that the appellant had obta....
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....g the CENVAT credit at the threshold, the amount of credit utilized towards payment of duty is as good as amount not availed. He further submitted that this issue is no more res integra and has been settled by various decisions of the Tribunal wherein it has been consistently held that CENVAT credit availed on inputs is not liable to be reversed when the process is held to be not amounting to manufacture when such credit is reversed while clearing the final products which according to the Revenue are exempt from payment of duty. He relied upon the following decisions. • Super Forgings and Steels Ltd. vs. CCE: 2007 (217) ELT 559 (Tri.-Chennai) • Ashok Enterprises vs. CCE: 2008 (221) ELT 586 (Tri.-Chennai) â....
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....: 2007 (213) ELT 29 (Tri.-LB) 6. After considering the submissions of both the parties and perusal of the material on record, we find that the appellant is engaged in the activity of cutting and slitting of Brass Strips, Phosphor Bronze Strips and Copper Strips falling under Chapter Sub-heading 7409 2100, 7409 1100 and 7409 3100 of the First Schedule of the Central Excise Tariff Act (CETA), 1985. We also find that while procuring the raw materials, appellant has paid the full amount inclusive of excise duty and thereafter availed CENVAT credit of the duty paid on inputs and after converting the coils into strips by undertaking portion of slitting and cutting, clearing the final goods by utilizing the CENVAT credit availed on inputs as al....
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....iew of the Supreme Court's judgment in Vee Kayan Industries v. CCE, Chandigarh, 1996 (83) E.L.T. 262 (S.C.), wherein conversion of 'black bars' (input) into 'bright bars' was held to be not amounting to "manufacture", that the assessee was not entitled to take CENVAT credit on 'black bars' inasmuch as, 'bright bars' were not excisable. The assessee took the stand that the credit was not liable to be denied as duty was actually paid on 'bright bars'. Assessee's contention was upheld in view of the Tribunal's decision in Syndet India v. CCE, Navi Mumbai - 2004 (166) E.L.T. 349 (Tri.-Mumbai), wherein it was held that even if duty was not payable on the finished goods (there being no manufacture), there was no question of recovery of any credit....
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....duty paid on the final product should be treated as reversal of the ineligible credit on the inputs and the assessee cannot be called upon to pay the credit :- (i) Singh Scrap Processors Ltd. v. CCE - 2002 (143) E.L.T. 619 (T) (ii) PSL Holdings Ltd. v. CCE - 2003 (156) E.L.T. 602 (T) (iii) Vinayak Industries v. CCE - 2003 (159) E.L.T. 456 (T) (iv) Silvassa Wooden Drums v. CCE - 2005 (184) E.L.T. 392 (T) (v) Stumpp Scheule & Somaopa v. CCE - 2005 (191) E.L.T. 1085 (vi) Shivali Udyog v. CCE - 2006 (204) E.L.T. 94 (T) (vii) CCE v. M.P. Telelinks Ltd. -2004 (178) E.L.T. 167 (T) (viii) Ajay Metachem v. CCE - 2006-TIOL-667-CESTAT-MUM (ix) Heat Shrink Technologies Ltd....