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TMI Blog2014 (12) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the rolls of smaller and required size; in respect of hinges there is no activity undertaken but the same are cleared as such by the assessee without any change in classification and thus appeared to be trading activity. Further gaskets are merely cut to the required length as per customers requirement and cleared without any change in the character and classification; the process of cutting gaskets to different lengths does not result in any new product emerging which is distinct from the original product; that the above activity undertaken by the assessee, does not change the constitution, character, name and classification of the inputs and no new product emerges with a new constitution, character, name and classification; that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to submit that if there is no manufacture, no credit can be taken. In our opinion, these observations came out because Hon'ble High Court's observation in paragraph 15 which is also to be considered. Paragraphs 15 to 17 of this decision are reproduced below:- 15. To our mind, there is considerable force in such contention. It is not in dispute that the respondent cleared the goods as such. Since no manufacturing activity was undertaken, question of collection of excise did not arise. While clearing the goods after 1-3-2003, the respondent had to follow the procedure laid down in the amended Rule 3(4) of Rules, 2002 and thereafter Rule 3(5) of the Rules of 2004. Such rules required that on clearance of goods on as such basis, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out by the respondent. Utilization of Cenvat credit for such purpose, therefore, was wholly impermissible. The decisions of the Apex Court cited before us and that of the Rajasthan High Court, at best may suggest that the payment made through Cenvat credit is as good as actual payment, however, such payment should be for the purpose for which it is authorized under the Rules. In the case of Dai Ichi Karkaria Ltd. (supra) relied on by the respondent, the Apex Court observed as under : 17. It is clear from these Rules, as we read them, that a manufacturer obtains credit for the excise duty paid on raw material to be used by him in the production of an excisable p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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