TaxTMI 
TaxTMI 
2025 (10) TMI 1189
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....redit of the central excise duty paid on the inputs / capital goods and service tax paid on the input services in terms of Cenvat Credit Rules, 2004 (CCR, 2004). During scrutiny of the CENVAT documents of the Appellant, it was found that they had inter alia, availed CENVAT credit of Excise duty paid on defective goods returned for Repair, Re conditioning etc. under Rule 16 of the Central Excise Rules, 2002. (CER, 2002). It was pointed out by Audit that credit is not permissible in respect of goods scrapped and cleared as there is no 'manufacturing activity' in respect of such goods. A SCN dated 05.09.2013 was issued to the Appellant proposing to recover the credit to the extent of Rs. along with interest pertaining to the period from April ....
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....3.3 The Revenue failed to address the issue relating to wrong calculation of the number of pieces scrapped. 3.4 Ld. Counsel placed reliance on the following decisions : (i) Classic Stripes Pvt. Ltd. Vs Commissioner -- 2018 (8) GSTL 442 (Tri.--Mum.) (ii) Bunty Foods (India) Pvt. Ltd. Vs Commissioner -- 2009 (240) ELT 306 (Tri.--Mum.) (iii) Bunty Foods (India) Pvt. Ltd. Vs Commissioner -- 2018 (359) ELT 267 (Tri.--Mum.) (iv) Sundaram Industries Ltd. Vs Commissioner -- 2006 (202) ELT 538 (Tri.--Chennai) (v) VFC Industries Pvt. Ltd. Vs Commissioner -- 2017 (347) ELT 189 (Tri.--Ahmd.) (vi) S.S. Steels Vs CCE -- 1991 (56) ELT 446 (Tri.) (v) Casting Combines Vs CCE -- 1989 (42) ELT ....
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....d penalty under Rule 15(2) of CCR. He prayed that Appeal may be dismissed. 5. Heard the rival contentions and after perusing the documents placed on record, the short point that arises for our consideration is, whether the demand as upheld in the impugned order is sustainable ? 6. The issue on hand revolves around interpretation of Rules 16 (1) & 16 (2) of Central Excise Rules, 2002 and for convenience, the same are extracted herein below : "RULE 16. Credit of duty on goods brought to the factory. - (1) Where any goods on which duty had been paid at the time of removal thereof are brought to any factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of suc....
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....time of initial/first removal on which the duty is undisputedly paid, such goods shall be subjected to 'process' of manufacture. The only natural consequence/Corollary that may follow when such returned goods are cleared as 'scrap' is the subject matter of present Appeal. 10. From the above, we find that the issue involves both question of facts as well as interpretation of law and hence, any suppression, that too, with an intention to suppress facts and evade duty cannot be alleged and therefore, at the outset, we are of the clear view that the allegation as to suppression of any facts with an intent to evade duty and thereby invoke the extended period of limitation cannot stand. On this ground alone, the demand confirmed in the impugne....