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M/s. Aakash Auto Industries Versus CCE, Delhi-IV, Faridbad

2016 (3) TMI 775 - CESTAT NEW DELHI

Disallowance of Cenvat Credit on bright bars used as inputs for manufacture of motor vehicles parts - Held that:- Interestingly, although the Apex Court in its judgment dated 20.09.1994 in CCE, Chandigarh Vs. Vee Kayan Industries (1994 (9) TMI 97 - SUPREME COURT OF INDIA ) had held that the processing of round bars into Bright bars would not amount to manufacture, the Department by Trade Notice No. 18/2003 dated 14/08/2003 had clarified that the process of making bright bars from wire rods amoun .....

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adjudicated and order passed. This goes to show that the Department itself was under much confusion as to whether excise duty is to be collected or not on bright bars.

See decision in Light Lift Industries vs. CCE, Delhi-IV-2010 (2009 (11) TMI 796 - CESTAT NEW DELHI) wherein it has been held that the credit is admissible on bright bars. Further, when inputs is received by the appellant and used in or in relation to manufacture of final product and payment of duty is evidenced by the i .....

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disallowance of Cenvat Credit on bright bars used as inputs for manufacture of motor vehicles parts. 2. The appellants are engaged in the manufacture of goods falling under chapter heading 7318.10 of the First Schedule to the CETA, 1985. They were also availing credit in respect of duty paid on inputs. It was observed that the appellants had wrongly availed credit on bright bars as Hon ble Supreme Court in the case of CCE, Chandigarh vs. Vee Kayan Industries,1983 (83) ELT 262 (SC) held that no p .....

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subject to excise duty as no process of manufacture was involved during transformation of bright bars from wire rods/rounds. The short question involved is whether the appellants are entitled to credit on the duty paid on bright bars used as inputs. According to the department, the manufacturer who supplied the bright bars was not liable to pay duty on these items as no process of manufacture was involved in the transformation of bright bars from round bars and therefore the appellants cannot a .....

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