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2023 (11) TMI 1068 - AT - Central ExciseDisallowance of CENVAT Credit - inputs and capital goods - process of making electronic capacitor grade metalized dielectric plastic film (MPP film), falling under Chapter 3920 2090 of the CETA, 1985, amounts to manufacture or not - HELD THAT:- The issue whether the process of making MPP film amounts to manufacture or not is no longer res integra - under similar facts and circumstances, the Coordinate Bench of this Tribunal at Mumbai in the case of Paper Products Ltd., vs CCE, Mumbai [2014 (3) TMI 521 - CESTAT MUMBAI] have distinguished the ruling of Hon’ble Supreme Court in the case of Metalex India Pvt Ltd., vs CCE [2004 (2) TMI 387 - SUPREME COURT] and have held that under similar facts and circumstances, the process amounts to manufacture. It is further found that Coordinate Bench in Chandigarh in the case of Dhruv Industries Ltd., vs CCE, Delhi-III [2018 (4) TMI 1492 - CESTAT CHANDIGARH] have also, under similar facts and circumstances, distinguished the ruling of Metalex and held that a new product comes into existence by use of the various raw materials viz., Poly Propylene, Polyester Films of Aluminium & Zinc, which is coated and further the process required use of capital goods/ machinery involving substantial cost and such process of manufacture takes about 36 hours. It was held that a new product comes into existence. Thus, the process of making MPP Films, capacitor grade from plain plastic film would amount to manufacturing process during the relevant period and the MPP, classifiable under CETH 3920 2090 would still be a manufactured good under Section 2(f), irrespective of absence of any chapter note specifically declaring the said activity as a manufacturing activity. Once the process is considered as manufacturing process, the credit becomes admissible. The Appellant is entitled to Cenvat credit - appeal allowed.
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