TMI Blog2020 (12) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... found cannot be re-made and the same were cleared as scrap on payment of duty, therefore, the provision of Rule 16(2) are not applicable to the facts of this case to allege that the goods were cleared as such. In fact, as per the facts of the case itself, it is clear that the returned goods were subjected to some process and when they were not found up to the mark were cleared on payment of duty as scrap - The appellant has correctly paid the duty as scrap at the time of clearances. Revenue Neutrality - HELD THAT:- The appellant has cleared these goods to their another unit. Admittedly, whatever duty have been paid, the same are entitled to cenvat credit to themselves. In that circumstances, it is a revenue neutral situation. In that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of Central Excise Rules, 2002. Therefore, two show cause notices were issued to the appellant and the matter was adjudicated, demand on account of equal amount of cenvat credit reversal was confirmed alongwith interest and penalty was also imposed. Against the said order, the appellant is before me. 3. The Ld. Counsel for the appellant submits that in this case, it is a fact on record that the appellant has exercised to remake the goods for sale but in some cases where the goods were not up to the quality mark, they were sold to their sister unit as scrap on payment of duty. Therefore, they have rightly availed cenvat credit in terms of Rule 16 of Central Excise Rules, 2002 and paid the duty on such clearances. Therefore, they we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red the submissions in detail. Paragraph 2 of the show cause notice is relevant to decide the issue in hand, the same is reproduced herein below:- 2. Whereas, the audit of the records of the noticee for the year 20122013 and 2013-14 was conducted on 19.11.2014, 20.11.2014 05.12.2014 by the internal Audit party of the erstwhile Central Excise Commissionerate, Delhi-III, Gurgaon (Now Central Excise Audit Commissionerate, Delhi-II), It was observed that the noticee had received back the rejected finished goods from its customers and were found lying in the backyard of the factory premises as non reparable on cursory physical walk of the factory premises. Further, scrutiny of the records of the noticee, it was pointed out that the not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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