TaxTMI 
TaxTMI 
2024 (12) TMI 836
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....g under Chapter Heading 85.04, 85.34 and 90.32 of the Central Excise Tariff Act, 1985. During the period 2004-2005, the appellant was a non-SSI unit and availed cenvat credit on the inputs which were used in the manufacture of stabilizers, which were cleared on payment of duty. On 30.11.2004, 100 stabilizers were returned for reconditioning and return. As per Rule 16(1) of the Central Excise Rules, 2002, cenvat credit was availed on the returned goods. During the period 2005-2006, the appellant opted for the benefit of Notification No.8/2003 dated 01.03.2003 and availed the benefit of exemption from payment of duty on final clearance of goods up to Rupees one crore. In accordance with the above Notification read with Rule 11(2) of Cenvat cr....
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....s were found to be defective and were returned and received back at the appellant's factory on 30.11.2004 for reconditioning, out of which 8 stabilizers were cleared on payment of duty in the same financial year 2004-05. With effect from 01.04.2005, the appellant was eligible for exemption under Notification No.8/2003 dated 01.03.2003. He stated that 47 stabilizers out of 100 stabilizers were cleared by availing exemption and the balance 45 stabilizers were thereafter cleared on payment of duty after the one crore limit was crossed. Therefore, the dispute is only with regard to 47 stabilizers cleared by availing full exemption under Notification No.8/2003 dated 01.03.2003. The contention of the department is that the amount equal to the cen....
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....ped the demand without any basis. On appeal filed by the Revenue, the Commissioner (Appeals) confirmed the wrongly availed cenvat credit. 4.1 It is further submitted that as per the provisions of Rule 16 of Central Excise Rules, 1944, the cenvat credit of the duty paid on returned goods is available when it is received back for being remade, refined, re-conditioned or for any other reason and if entitled to take the credit as if such goods are received as inputs under Cenvat Credit Rules, 2004. In the present case, 100 stabilizers were returned, out of which only 8 were cleared on payment of duty after reconditioning. Therefore, the 92 stabilizers which were returned needs to be considered as inputs lying in stock; consequently, the cenv....
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....e process to which the goods are subjected before returning does not amount to manufacture, the manufacturer shall pay an amount equal to the CENVAT credit taken under sub-rule (1) and in any other case the manufacturer shall pay duty on goods returned under sub-rule (1) at the rate applicable on the date of removal and on the value determined under sub-section (2) of section 3 or section 4 or section 4A of the Act, as the case may be. 7. When the 100 stabilizers were returned for reconditioning as per Rule 16 of Central Excise Rules, reproduced above the appellant was eligible for cenvat credit deeming the finished product as inputs as stated in the Rules "the assessee shall state the particulars of such return in his records and shall ....
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....e aggregate of, - (i) the duty of excise specified thereon in the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (hereinafter referred to as the First Schedule); and (ii) the special duty of excise specified thereon in the Second Schedule to the said Central Excise Tariff Act, 1985 (hereinafter referred to as the Second Schedule), as is in excess of the amount calculated at the rate specified in the corresponding entry in column (3) of the said Table : Provided that nothing contained in this notification shall apply to a manufacturer who has availed the exemption under notification No. 39/2001-Central Excise, dated the 31st July, 2001, published in the Gazette of India vide number G.S.R....
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....e from which option under this notification has been exercised; (f) aggregate value of clearances of specified goods (excluding the value of clearances referred to in paragraph 3 of this notification) till the date of exercising the option; (iii) the manufacturer shall not avail the credit of duty on inputs under rule 3 or rule 11 of the CENVAT Credit Rules, 2002 (herein after referred to as the said rules), paid on inputs used in the manufacture of the specified goods cleared for home consumption, the aggregate value of first clearances of which, as calculated in the manner specified in the said Table does not exceed rupees one hundred lakhs; 9. The relevant provisions of Rule 11 (2) of the Cenvat Credit Rules reads "w....