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2021 (5) TMI 838 - AT - Central ExciseCENVAT Credit - inputs - welding electrodes - denial on the ground that the welding electrodes used in the maintenance of plant and machinery cannot be called as inputs used in the manufacture of their final products - Penalty - HELD THAT:- A perusal of the SCN shows that the actual period in respect of the disputed CENVAT is April 2013 to March 2014. The period is significant since the definition of ‘input’ under CENVAT Credit Rules, 2004 was changed with effect from 1.3.2011 and this amended definition is relevant for the period of dispute. Penalty - HELD THAT:- There is no dispute that the welding electrodes were used in the factory of the manufacturer as they were used to maintain the machinery. Therefore, they are squarely covered by the definition of ‘input’ under Rule 2(k). Unlike the definition of input prior to 1.3.2011, for something to qualify as an input, it need not be used in or in relation to manufacture of the final product but it only needs to be used within the factory of the manufacturer. There is no dispute that the welding electrodes have been so used. CENVAT credit can therefore, not be denied. Consequently, the penalty also cannot be imposed. The impugned order dated 16.02.2018 passed by the Commissioner (Appeals) denying the CENVAT credit and upholding the penalty is contrary to law and cannot be sustained - Appeal allowed - decided in favor of appellant.
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