2007 (7) TMI 117 - AT - Central Excise

Denial of credit on containers cleared as scrap on the ground that containers were damaged and rejected even before their use in packing the final goods Allegation stated above are based only on presumption so duty demand and penalty are unsustainable

Summary

The Appellate Tribunal CESTAT, Mumbai allowed the appeal against the denial of Cenvat credit on metal containers cleared as scrap for packing paints. The Tribunal found that there was no evidence to support the claim that the containers were damaged/rejected before use, and hence, they could be considered as inputs for packing paints. The duty demand and penalty were set aside.