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TMI Blog2023 (11) TMI 1068X X X X Extracts X X X X X X X X Extracts X X X X ..... ound that the activity of the Appellant i.e., the process of making electronic capacitor grade metalized dielectric plastic film (MPP film), falling under Chapter 3920 2090 of the CETA, 1985, does not amount to manufacture. The brief facts are as follows: a) The Appellant is engaged in the manufacture of (i) "Capacitors" falling under sub-heading No.8532 2500 and (ii) Electronic Capacitor Grade Metallized Dielectric Plastic Film (MPP Film) falling under Chapter 3920 2090 of the Central Excise Tariff Act, 1985. b) The Production process of Capacitor begins with making MPP out of Plain Plastic Film. In addition to captive use of MPP in the capacitor, MPP are also cleared to DTA. c) The case of the department in the present proceedings i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision. b) Thus, the department has been contending as late as in 2007 that the process of metallization would amount to manufacture and is liable to duty. Further, the authorities did not object to the payment of excise duty at any point of time immediately after the said judgement of the Apex Court. c) Therefore, the Appellant also entertained a bonafide belief that the process of metallization amounts to manufacture and consequently paid duty on clearance of MPP Film. d) The Appellant submits that the judgment in the case of Metalex (supra) is not applicable in the facts and circumstances of the present case. In the case of Metalex, the Hon'ble Supreme Court came to the conclusion that the activity of metallization does not amount t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .T. 145 (Tri-Mum)] where in it has considered the decision of the Apex court and held that the process amounts to manufacture. This decision is affirmed by the Hon'ble High Court of Bombay in the case of Commissioner Vs. Paper Products reported at [2015 (320) E.L.T. A200 (Bom)]. 4. By way of alternate submission, learned Counsel further submits as follows: a) The MPP Films were cleared to DTA on payment of duty. Without prejudice to the above submissions, that the Appellant has undertaken manufacturing activity, credit cannot be denied as the output excise duty is discharged by the Appellant to the tune of Rs. 87,59,377/- as against credit availed amounting to Rs. 56,14,519/-. b) In this regard, reliance is placed on the decision in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar view taken by the Gujarat High Court in the case of Creative Enterprises has been upheld by the Apex Court [see 2009 (243) E.L.T. A121] by dismissing the SLP filed by the Revenue.". d) Further reliance is placed on the following decisions: i) R.B. Steel Services Vs. CCE, Rohtak - 2015 (318) ELT 139 (Tri- Del) ii) Commissioner Vs. Creative enterprises- 2009 (235) E.L.T. 785 affirmed by the Apex Court in 2009 (243) E.L.T. A120 (S.C.) iii) CCE, Aurangabad Vs. Sunrise Industries - 2015(315) E.L.T 62 (TriMum) e) The Appellant further submits that 3,70,791.600 kgs (Credit amount of Rs. 52,67,111/-) of MPP is consumed captively in the manufacture of capacitors on which duty is paid and hence credit cannot be denied. Reliance is pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly, learned Counsel prays for allowing the Appeal with consequential benefits. 6. Learned AR for Revenue relies on the Impugned Order. 7. Having considered the rival contentions, we find that the issue whether the process of making MPP film amounts to manufacture or not is no longer res integra. We find that under similar facts and circumstances, the Coordinate Bench of this Tribunal at Mumbai in the case of Paper Products Ltd., vs CCE, Mumbai [2014 (304) ELT 145] have distinguished the ruling of Hon'ble Supreme Court in the case of Metalex India Pvt Ltd., vs CCE [2014 (165) ELT 129 (SC)] and have held that under similar facts and circumstances, the process amounts to manufacture. We further find that Coordinate Bench in Chandigarh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on correct appreciation of provisions of Section 2(f). 9. In view of the aforementioned findings and observations, the issue in dispute no longer survives. Accordingly, we hold that the process of making MPP Films, capacitor grade from plain plastic film would amount to manufacturing process during the relevant period and the MPP, classifiable under CETH 3920 2090 would still be a manufactured good under Section 2(f), irrespective of absence of any chapter note specifically declaring the said activity as a manufacturing activity. Once the process is considered as manufacturing process, the credit becomes admissible. Accordingly, we hold that Appellant is entitled to Cenvat credit, which has been disallowed by the Impugned Order. 10. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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