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TMI Blog2014 (12) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... stomers is sometimes received by them either under the cover of the invoices issued by their customer or under the cover of the invoices issued by the respondent themselves. In terms of the provisions of Rule 16 of the Central Excise Rules, the respondent was entering goods in their input receipt register and was availing the Cenvat Credit in Credit Account Register. There is no dispute about the availment of credit by the Respondents. 3. However, the Revenue was of the view that is inasmuch as after entering the goods in their Cenvat Account, the assessee has simplicitor shown the issuance of the said inputs for further manufacture, without maintaining any records about the same. Statements of the various persons recorded during investiga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leged that the reprocesses like rewinding cutting, slitting, re-packing undertaken by the appellant on the returned goods do not amount to 'manufacture' as defined under Section 2(f) of the Central Excise Act 1944 and the appellant should not pay duty less than the credit availed by them on such goods in terms rule (2) of Rule 16 ibid. I find that the goods were returned because of not meeting their purchase specifications and process incidental/ancillary to rendering of the goods as marketable would qualify the application of manufacture and consequent levy thereafter, as defined under law. As regards differential demand on 80% of sales returns cleared as scrap is not sustainable because same is based on presumptions and assumptions as the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire exercise would be revenue neutral. 6. On going through the submission so made as also by the learned DR and after going through the impugned order of Commissioner (Appeals), I find no reasons to disagree with the finding of the appellant authority. As rightly observed by him, Revenue on one hand, is contending that no records were being maintained by the assessee after receipt of the returned goods, so as to show the further process taken by them and on the other hand, they are contending that 80% of the receipt material was cleared as scrap. The said submission of the Revenue is based upon the statement of the employee, without verifying as to whether the waste and scrap so cleared by the appellant emerged during the course of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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