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2005 (7) TMI 179 - AT - Central ExciseCenvat/Modvat - "scrap" - Evidence - Appreciation of the statements - Misdeclaration - Input - whether the description of 'CRCA scrap' actually observed and M.S. offcuts etc. mentioned on the duty documents should lead to a conclusion that the inputs allegedly received and taken credit, were not covered by the duty paid documents - HELD THAT:- The allegation of segregation and bundling will not in any case being any charges on the Second Stage Dealers & the assessee. The perusal of the statement of Shri Abdul H. Khan of Kohinoor Trading Company dated 30-7-2001 indicates no press bundling but only hand bundling to have been done, as well as it indicates they buy A-grade scrap at Tender price from M/s. Bajaj; thereafter they sort out good pieces & sell on Modvat credit only the remainder quantity at pro rata duty. There appears to be nothing improper in this approach & that cannot call for denial of the credit on invoices issued by such dealers. They had received the scrap classified as 'M.S. Offcuts of M.S. Sheets'. Same we sorted out, thereafter sent as "M.S. Scrap". Mere change of nomenclature, will not call for denial of credit. This Tribunal in the case of Singh Scrap Processors Ltd. v. CCE, Mumbai [2002 (4) TMI 114 - CEGAT, MUMBAI] had held that removal of impurities in the scrap purchased & compressing with aid of mechanical press to form billets would amount to manufacture. If the dealers activities, amounted to manufacture, as per this decision then the dealers should have been brought under the Excise net for the activity of segregation & bundle billet formation. The denial of the credit on the dealers invoices, for the reason, as arrived, cannot be upheld when no efforts are made to bring this activity of the dealers under excisable manufacture. If the dealer status is not questioned, then the dealers need not maintain the records of inputs for which they have not issued Modvatable invoice, as in the case herein & the facts revealed. There is nothing incriminating in sale of goods prices at higher value & no Modvat invoice issued. We therefore find no reason to arrive at for denying the credit as availed & penalty on the assessee or/& the dealers as arrived in this case. The duty, interest & penalty orders are therefore to be set aside. Before parting, we would like to observe that the decision of Sunshine Structures & Engineering Ltd. v. CCE [2004 (8) TMI 697 - CESTAT MUMBAI] relied by the appellant will not help the assessee for the period under Cenvat Rules & also when the order is not being upheld on merits, we do not go into question of applicability of the decision for part of period. Appeal disposed off, on merits, by setting aside the order and allowing the appeals.
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