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2022 (10) TMI 797 - AT - Central ExciseUtilization of CENVAT Credit for payment of Excise duty - goods procured under Notification No. 43/2001-CE (NT) for the clearance of the same without putting to use for manufacture of exported goods - HELD THAT:- The identical issue has been considered by the tribunal in the matter of M/S. SHREE RAJASTHAN SYNTEX LTD., SHRI S.K. BHANDARI AND SHRI V.K. LADIA VERSUS CCE, JAIPUR-II [2016 (3) TMI 200 - CESTAT NEW DELHI], M/S. SHREE RAJASTHAN TEXCHEM LTD. VERSUS CCE, JAIPUR [2015 (2) TMI 653 - CESTAT NEW DELHI] and GINGER CLOTHING PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, THANE [2014 (2) TMI 868 - CESTAT MUMBAI] and the payment of duty on the goods procured under Notification 43/2001-CE (NT) by utilization form cenvat credit for payment has been allowed - Therefore, following the said decisions it is held that the demand of duty can be paid by utilizing cenvat credit being no bar in law in this regard. CENVAT Credit - inputs and packing materials used in the manufacture of medicament (exhibit batches) and the same is tested for trial and quality purpose and were destroyed / disposed off within the factory thereafter - HELD THAT:- There is no dispute in the facts that packaging /raw materials on which Appellant has claimed Cenvat credit has been used in process of manufacturing of medicaments for trial and testing purpose and quality purpose under the Drugs and Cosmetic Act, which was subsequently destroyed. On the basis of such testing /quality control process only the marketability of the product is ascertained. Accordingly, the raw materials/ packaging materials which is used in manufacturing and which goes for testing /quality process are indeed the inputs which are used in or in relation to manufacturing of final products. The nature of products manufactured by the Appellant is such that it is a must/ necessity that it needs testing and hence, the same forms an integral part of manufacture and without which it is not possible to manufacture the final products. Thus, the Appellant is entitled for credit on input and packaging materials used for testing products (Exhibit batches) - reliance can be placed in the case of THERMAX CULLIGAN WATER TECHNOLOGIES LTD VERSUS COMMISSIONER OF CENTRAL EXCISE [2013 (12) TMI 977 - CESTAT MUMBAI] where it was held that In the present case, the Revenue has not adduced any evidence that the control samples have been removed from the factory and has not been consumed or lost or destroyed during the course of testing. In the absence of any corroborative evidence of removal of these samples from the factory, the demand of duty on such control samples cannot be sustained. Whether the Appellant is liable to pay duty on goods cleared from factory on non-returnable challans for testing and sampling purpose? - HELD THAT:- The pharmaceutical goods before being marketed should be sent for tests and sampling purpose in terms of the provisions of Drugs and Cosmetics Act, 1945. The medicaments cleared under the cover of non-returnable challans for testing and sampling purpose cannot be considered as manufactured goods as the same is not marketable in as much as the same has not attained any level of marketability as is clear from the facts that the same was sent outside the factory premises for testing and sampling purpose. Marketability is decisive test for dutiability - the samples cleared for testing and quality control test are not liable to any excise duty. No demand is sustainable - Appeal allowed - decided in favor of appellant.
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