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2018 (8) TMI 947 - AT - Central ExciseCENVAT Credit - removal of inputs as such in guise of manufacture - payment of duty on removal less then availed on inputs - extended period of limitation - The department observed while comparing the inputs & the final products with the input invoices, that the appellant has paid duty less than the CENVAT credit availed on the inputs - recovery of short duty paid under Rule 14 of CENVAT Credit Rules read with Section 11 A of Central Excise Act, 1944(CEA) alongwith the interest and the proportionate penalty. Held that:- In the present case the admitted activity is cutting and silting of CRGO Coils irrespective the Tariff head had been changed but to still to be called as manufacture, the activity has either to be identical or ancillary to the completion of final product or should itself amount to manufacture or should be a process which in relation to the goods specified in third schedule involves packing or re- packing of such goods in a unit container. The main product of appellant, admittedly, is the manufacture of transformer core stack falling under Chapter 85 of CETA 1985 for which the CRGO Coils is the main input. It becomes clear that the unused input if cut into any other form but since is not used in the manufacture of final product of the appellant the same can be nothing more than the clearing of the unused input/ raw material. The appellant has removed the inputs as such and has failed to reverse the equal cenvat credit which has been taken on the said inputs and thus has contravened the provision of Rule 3 (5) of Cenvat Credit Rules, 2004 (CCR) Rule 2004. The appellant rather, while removing the inputs as such was required to pay cenvat credit taken by them. With respect to this show cause notice dated 27.10.2015 the appellant has submitted that the adjudicating authority below has failed to consider the documents of the appellant i.e. Exhibit-F at page no. 155 wherein it has been specifically shown that the cenvat credit availed by the appellant is much less than the duty paid by him. Perusal of the document reflects correctness in the contention of the appellant order under challenge is observed to be silent to this aspect - The matter is remanded back to the Additional Commissioner however for the limited purpose as above i.e. for computation. Appeal allowed in part and part matter on remand.
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