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2007 (5) TMI 519 - CESTAT, BANGALORECenvat/Modvat - Reversal of credit - rejected goods - Rule 16(2) of CER - Held that: - when the rejected goods are cleared as scrap, Rule 16(2) comes into play. When the rejected goods are cleared as scrap, then the process to which the rejected goods are subjected does not amount to manufacture and in terms of Rule 16(2) in such a case, the manufacturer shall pay an amount equal to Cenvat credit taken under sub-rule (1) - In the present case, the Cenvat credit taken under sub-rule (1) is ₹ 1,14,351/-. This amount has to be paid to the Revenue in terms of Rule 16(2). Therefore the orders of the lower authorities are legal and proper - appeal dismissed - decided against appellant-assessee.
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