TMI Blog2019 (4) TMI 743X X X X Extracts X X X X X X X X Extracts X X X X ..... ued Circular No. 1027/15/2016-CX dated April 25, 2016 wherein it clarified that post insertion of Explanation on March 1, 2015, credit upon clearance of waste, such as aluminium dross etc. needs to be reversed. In case, the revenue had any objection with respect to manner of reversal of cenvat credit, it should have pointed out then and there. Its acceptance implies that revenue completely agreed with the manner of computing reversal. Thus revenue cannot turn around and dispute the manner of reversal without bringing any additional evidence or point of law, not considered earlier - these submissions were duly made before the Appellate Authority which it has failed to take into account. In the absence of sustenance of duty demand, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shri H.C. Saini, Ld. Department Representative (DR) on behalf of the Revenue. 4. It is the contention of Ld. Counsel for Appellant that Rule 6 requires reversal of credit only in case where the inputs are involved in manufacture of exempted goods and final products. There is a twin condition of manufacture and exempted goods which needs to be cumulatively satisfied. The waste and scrap concerned cannot be said to have been manufactured. The Ld. Counsel further contends that Appellant has regularly reversed credit of common input services post the insertion of Explanation which were duly intimated to the authorities through option letter and finalisation letter in terms of Rule 6(3A) in respect of impugned waste for FY 2014-15 and FY 2015 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods under Rule 2(d) of the Credit Rules. We agree with the contentions raised by the Appellant that Rule 6 requires reversal of credit only subject to satisfaction of twin conditions of manufacture and exempted goods. It is seen from the statutory provision that the Explanation 1, inserted with effect from March 1, 2015, includes non-excisable goods in the definition of term exempted goods in the following words: Explanation 1.- For the purpose of this rule, exempted goods or final products as defined in clauses (d) and (h) of Rule 2 shall include non-excisable goods cleared for a consideration from the factory (emphasis supplied) 8. In this context, it is noteworthy that aluminium dross has been held to be non-manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny such activity, which may be called as manufacture. 9. In view thereof, I am of the opinion that irrespective of the amendment, there arises no liability upon the appellant to pay the duty as demanded for the period w.e.f. September, 2014 to February, 2015 in Appeal No. 52211/2018 nor for the reversal of the credit as demanded for the period June, 2015 to March, 2016 in Appeal No. 52210/2018. 10. Further, much of the impugned products, like carton boxes etc. forms containers in which inputs were received. The reversal of credit upon clearance of such containers came up for issue in 2003. The CBEC (Now CBIC) vide its Circular No. 721/37/2003-CX dated June 6, 2003 clarified that no credit shall be reversed on waste packing m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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