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TMI Blog2011 (9) TMI 862X X X X Extracts X X X X X X X X Extracts X X X X ..... t of so-called non-marketable/non-saleable cigarettes returned by their own sales offices only - Held that:- In the face of the clear language of the above rule, the finding of the Commissioner that very first condition for eligibility of credit on returned goods is that the goods must be usable and used as inputs in the manufacture of finished goods is prima facie not tenable. Further, in the pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the manufacture of cut tobacco and different brands of cigarettes and avail Cenvat credit on inputs, capital goods and input services in terms of the Cenvat Credit Rules, 2004. They have submitted a series of letters of the jurisdictional Superintendent from time to time informing the quantum of cigarettes received back for reprocessing for the reasons that the cigarettes were not fit for mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Section 11A(l) of the Central Excise Act, 1944, together with recovery of interest under Section 11AB ibid for taking inadmissible credit, and proposing penal action against the assessees. The notices were adjudicated by the Commissioner, Ghaziabad who confirmed the demands raised in both notices, imposed penalty of equal amount, and ordered for recovery of interest. Hence these applications fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the manufacture of finished goods is prima facie not tenable. Further, in the present case, a large percentage of tobacco (obtained by ripping open returned cigarettes) is used along with fresh tobacco in the manufacture of fresh cigarettes. Thus, prima facie, the assessees are entitled to credit in terms of Rule 16 and the duty demand is prima facie not sustainable in the light of Rule 16 an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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