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2021 (8) TMI 238 - AT - Central ExciseCENVAT Credit - input - PVC Filler Hollow - credit denied to the assessee on the ground that the supplier of raw material was not liable to pay the duty on the goods supplied - HELD THAT:- The duty being paid by M/s. Shiv Industries and that there is no cogent evidence that PVC of M/s. Shiv Industries is covered under Notification No. 12/2012, the relief in respect of the said duty paid including the availment of CENVAT Credit by the recipient of the goods on which the duty was paid, cannot be denied. This has been the settled law that once the raw material has suffered the excise duty, then the relief should be granted in respect of duty payable on final products. The perusal of the provisions of CCR makes it abundantly clear that the terminology used in the relevant provisions in Rule 3 erstwhile Section 57A (1) is ‘paid’ and not ‘payable’. Hon’ble High Court at Madras in COMMISSIONER OF CENTRAL EXCISE, CHENNAI-I VERSUS CEGAT, CHENNAI [2005 (1) TMI 125 - HIGH COURT OF JUDICATURE AT MADRAS] has held that the said terminology is sufficient to consider the factual state of affairs that as to whether the duty has actually been paid on the raw material and not whether duty was payable or not. Classification of the goods cannot be changed at the recipient’s end, the issue is again settled and is no more res integra as is apparent from the decision of Hon’ble Apex Court in the case of SARVESH REFRACTORIES (P) LTD. VERSUS COMMISSIONER OF C. EX. & CUSTOMS [2007 (11) TMI 23 - SUPREME COURT] wherein it has been held that the classification by the manufacturer only has to prevail, the same cannot be altered at the buyers’ end. Once M/s. Shiv Industries has classified its PVC under Chapter Heading 3904 and admittedly Chapter heading 3904 is not merely for such PVC which is manufactured by scrap and is exempted from duty. The said classification cannot be denied by the appellant specially when the invoices received by him shows the payment of duty by his supplier. The question of adjudication is answered in negative holding that CENVAT Credit cannot be denied on the ground that the supplier was not liable to pay the duty on the goods supplied. Also it is observed that the finding of Commissioner (Appeals) about M/s. Shiv Industries that the product supplied by them was exempted from payment of duty is based merely on the letter from the Jurisdictional Incharge - There is no discussion in the impugned order about any mention in the letter of Jurisdictional officer about manufacturing process of M/s. Shiv Industries and about using the scrap for manufacture of their ‘PVC Filler Hollow’. Nor there is any iota of evidence about the manufacturing process of six other supplier. Appeal allowed - decided in favor of appellant.
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