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2017 (7) TMI 713 - AT - Central ExciseCENVAT credit - inputs used in the manufacture of Dry Battery Cells - waste batteries - Rule 6 of CCR - Held that: - Sub-rule (2) of Rule 6 mandates that where a manufacturer manufactures both dutiable and exempted goods and used common input for manufacture of such two types of goods, then he has to maintain separate records and cenvat credit in respect of inputs used in the manufacture of exempted goods should not be availed as cenvat credit. In the present case, Since some quantities of batteries (less than 1%) are not capable of being sold, being declared as waste, as a result of quality control test, the same were dumped inside the factory. It cannot be said that the waste batteries are exempted goods inasmuch as the same are neither chargeable to nil rate of duty nor are exempted in terms of the notification issued by the Central Government under Section 5 of the Central Excise Act, 1944. Since the waste batteries are not exempted from payment of duty, the embargo created in Rule 6 of the said rules will not be applicable for payment of amount/ reversal of cenvat credit in the generation of the waste batteries. Appeal allowed - decided in favor of appellant.
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