Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (11) TMI 1276 - CESTAT ALLAHABAD

2016 (11) TMI 1276 - CESTAT ALLAHABAD - TMI - CENVAT credit - recovery - Subsection 1 of Section 11A of Central Excise Act, 1944 - Held that: - the packing of sugar into 1 & 5 kgs pack is done in the factory premises. The goods when brought into such packing division are again entered into RG-I Register and subsequently packed into 1 & 5 kgs packs. The clearance of such goods from factory on payment of a specific rate of duty. The packing material on which Cenvat Credit was availed were used for .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

finished goods and being in the nature of incidental or/and ancillary to the main manufacturing activity, the assessee in this case was rightly held entitled to claim Modvat credit on the item- “Hot Melt Unit” treating the same as capital goods under the Rule 57Q ibid for claiming benefit. - The packing is activity incidental or/and ancillary to the main manufacturing activity. Therefore, Cenvat Credit of duty paid on inputs used for packing sugar in 1kg & 5 kg packs is admissible to the ap .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n up together for decision. 2. Show Cause Notice C No. V(15)Off/Adj.-I/41/2012 dated 06/03/2012 was issued to the appellant. The said show cause notice was adjudicated though Order-in-Original No. 08/ADC/MRT-I/2013 dated 01/03/2013. An appeal preferred against the said Order-in-Original dated 01.03.2013 was decided through Order-in-Appeal No. 137/APPL/MRT-I/2013 dated 30/09/2013. The period for issue of show cause notice dated 06.03.2012 was from February, 2007 to January, 2012. The said Order-i .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

id Order-in-Appeal dated 13.01.2014 is impugned order for Appeal No. E/53366/2014. 3. The brief facts of the case are that the appellants are engaged in the manufacture of sugar and they are availing Cenvat Credit of duty paid on inputs and capital goods. The appellants manufactured goods and packed them in 50kg. and 100kg. bags. Subsequently the production is entered in RG-1 Register. The assessee within the premise of their factory have separate place for packing of sugar into 1kg. packs and 5 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ugar in 1 and 5kgs. pack within premises of factory was post manufacturing activity and therefore it appeared to Revenue that Cenvat Credit availed on above stated packing materials used for packing of goods into 1 & 5kgs. packs was inadmissible to the appellants. Therefore, above referred show cause notice dated 06.03.2012 was issued to the appellant invoking the proviso to Subsection 1 of Section 11A of Central Excise Act, 1944 with the proposal for recovery of Cenvat Credit of ₹ 23, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he sugar is sold, the duty payable is specific duty per quintal of sugar and the packing of 5 & 1 kg pack is process incidental of completion of manufactured product. The stage of manufacture in case of sugar in pack of1kg & 5kg has been extended till such packing is completed in packing division of the factory. Therefore, Cenvat Credit availed on packing material is proper, correct and appropriate in law. They further contended that show cause notice was hit by limitation since the fact .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

acking of goods in smaller packs was activity post manufacturing. Therefore, he denied the Cenvat Credit of ₹ 23,94,185/- and imposed equal penalty. He dropped the proceedings against Sri Mohindar Singh. The appellant carried the matter before the Commissioner (Appeals). The grounds of appeal before Commissioner (Appeals) were that the said Order-in-Original dated 01/03/2013 was against the definition of input under Rule 2 of Cenvat Credit Rules, 2004 wherein the goods used as packing mate .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

13. 4. Through show cause notice dated 28/02/2013, the Revenue proposed to deny Cenvat Credit of ₹ 1,10,798/-. The grounds of show cause notice were same as those of show cause notice dated 06/03/2012. The assessee submitted the same grounds in reply to show cause notice. The Original Authority confirmed the demand and ordered to pay interest and imposed equal penalty through Order-in-Original dated 04/09/2013. The appellant carried the matter before Commissioner (Appeals) on the similar g .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

be assessed in the condition in which the goods are cleared from the factory and that the show cause notice dated 06/03/2012 is hit by the bar of limitation and that the Cenvat Credit was admissible as per the definition of inputs in Cenvat Credit Rules, since the inputs were packing material and used within the factory of manufacturer. 6. Heard the learned counsel for the appellants. He has urged that the goods are not removed from the factory and then re-packed in 1 & 5 kgs pack. The pack .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

erefore, Cenvat Credit is admissible to them. There are a large number of pronouncements holding that packing of goods is not post manufacturing activity. He has relied on ruling of Hon ble High Court of Chhattisgarh in the case of Commissioner of Customs and Central Excise Vs. Advani Oerlikon Ltd. reported at 2014(306) E.L.T. 66 (Chhattisgarh). He has further submitted that Commissioner (Appeals), Meerut in the case of M/s. DSM Sugar through his Order-in-Appeal No. MRT/EXCESS/000/APPL-I/137-CE/ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d subsequently packed into 1 & 5 kgs packs. The clearance of such goods from factory on payment of a specific rate of duty. The packing material on which Cenvat Credit was availed were used for packing of goods into 1 & 5 kgs. pack within the premises of factory. We find that the ratio of the ruling of Hon ble High Court of Chhattisgarh in the above stated case of Advani Oerlikon Ltd. is squarely applicable in the present case. The Hon ble High Court of Chhattisgarh has observed in its s .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

roduct and marketability are the twin aspects to decide chargeability. Dutibility of the product depends on whether the product is known to the market. The test of marketability is that the product which is made liable to duty must be marketable in the condition in which it emerges. Marketable means saleable. The test of classification is, how are the goods known in the market. These tests have been laid down by this Court in a number of judgments including Moti Laminates Pvt. Ltd. v. Collector .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version