2024 (2) TMI 1018
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.... I. The finished Clutch Assemblies manufactured and supplied by other manufacturers (herein after referred as 'vendors") were received by the appellant in bulk packings on payment of duty under Section 4 of the Central Excise Act, 1944. The appellant, in turn, re-packed them into retail packs and affixed the MRP price on the retail packs and cleared them on payment of duty by adopting the price under Section 4A for the spare markets. 1.2. Finished Clutch Assemblies manufactured and supplied by the Unit I were received by the appellant on payment of duty. However, the above said packed and MRP marked goods received from Unit-1, Hosur were cleared as such to spare market by the appellant. Retail packing by affixing the brand name "M/s. LUK India" and MRP etc. was carried out the appellant only on those goods that were supplied by other vendors. 1.3. The appellant had taken credit of CENVAT paid on the goods received from both unit I and other vendors. However, it appeared that the goods received from Unit-I was merely for the logistics purpose and did not qualify as an "input" for the appellant, since they did not under go any deeming manufacturing activities such as packing / ....
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....volving the process packing/re-packing, labelling/re- labelling, affixing of new MRP labels etc. in their unit. The said clearances were made during the period from September, 2010 to March, 2012, and had thus resulted in the clearance of goods without payment of duty. 1.10. The appellant did not disclose facts to the department that the goods received from Unit-I were only for logistics purpose and that such goods did not require any manufacturing activity such as packing / re-packing, labelling/ re-labelling, affixing of new MRP labels etc at the hands of the appellant. 1.11. The appellant suppressed the fact that the goods received from Unit-1 were only for logistics purpose which did not undergo any manufacturing activity in their ERI returns. But for the detailed audit conducted, the clearance as such would not have come to light for which proviso to Section 11A/11A (5) of Central Excise Act, 1944 is invokable. 1.12. The appellant was issued Show Cause Notice dated 31/08/2012 proposing to demand the wrongly availed CENVAT credit of Rs.11,54,59,277/- taken by them on the goods received from Unit 1 during the period from September 2010 to March 2012 along with interest and al....
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....artment to deny the CENVAT credit alleging that there was no manufacture. The appellant was affixing MRP on account of price revision and required activities. 2.4. The department having accepted the duty paid at the time of clearance as valid payment of duty, cannot contend that no manufacturing was done to deny the CENVAT Credit. The appellant always contended that the goods were cleared on payment of duty and details of clearances and payment of duty was duly disclosed in the monthly return. There is no denial or dispute of the fact of payment of duty and filing of return. 2.5. Appellants had furnished the details of duty payments for the clearances for home consumption and details of goods cleared exports in their dated 19.01 2022. There is no dispute as to the correctness of the details provided by the appellant. In fact, details were verified and found to be correct. Goods manufactured, out of the procurements from other Vendors and the goods procured from Unit-I were duly accounted in the common finished goods stock register. On a comparison of invoices issued by the Unit II and ER-1 returns, the duty payment was verified by the department and no dispute appears to have ta....
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.... of credit availed on the goods cleared from Unit 1 to Unit 2. It is an undisputed fact that the appellant has cleared all goods from unit 2 by payment of duty. When the department has collected duty on the finished products, the credit availed on the inputs cannot be denied alleging that the activity does not amount to manufacture. This issue is settled by the decisions in the case of Ajinkya Enterprises (supra) wherein the Hon'ble High Court of Bombay held as under. "10. Apart from the above, in the present case, the assessment on decoiled HR/CR coils cleared from the factory of the assessee on payment of duty has neither been reversed nor it is held that the assessee is entitled to refund of duty paid at the time of clearing the decoiled HR/CR coils. In these circumstances, the CESTAT following its decision in the case of Ashok Enterprises - 2008 (221) E.L.T. 586 (T), Super Forgings - 2007 (217) E.L.T.559 (T), S.A.I.L. - 2007 (220) E.L.T. 520 (T) = 2009 (15) S.T.R. 640 (Tribunal), M.P. Telelinks Limited - 2004 (178) E.L.T. 167(T) and a decision of the Gujarat High Court in the case of CCE Vs. Creative Enterprises reported in 2009 (235) E.L.T. 785 (Guj.) has held that once the ....
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....ed in or in relation to assembly of packing kits, on which appropriate duty was paid by the appellant. The Revenue proposed to deny the credit only on the ground that the assembly of various inputs into packing kits does not amount to manufacture. However, there is no dispute of fact that appropriate duty has been paid and collected by the Revenue on the packing kits. The issue, in our view, is no more res integra and covered by the decision of Hon'ble Bombay High Court in the case of Ajinkya Enterprises (supra) and dealing the similar issue the Hon'ble Bombay High Court has held as under:- "10 Apart from the above, in the present case, the assessment on decoiled HR/CR coils cleared from the factory of the assessee on payment of duty has neither been reversed nor it is held that the assessee is entitled to refund of duty paid at the time of clearing the decoiled HR/CR coils. In these circumstances, the CESTAT following its decision in the case of Ashok Enterprises 2008 (221) E.L.T. 586 (T) = 2008- TIOL-312-CESTAT-MAD "Super Forgings 2007 (217) E.L.T. 559 (T) = 2007-TIOL-2040-CESTAT-MAD"S.A.I.L 2007 (220) E.L.T. 520 (1) 2009 (15) ST.R. 640 (Tribunal), M.P. Telelinks Limite....