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TMI Blog2015 (10) TMI 2201X X X X Extracts X X X X X X X X Extracts X X X X ..... d has been specified under Rule 16 to be maintained by an assessee. The documents on the basis of which CENVAT credit is taken is also available with the appellant. The records maintained by the appellant is showing the issue slips for remanufacture of the goods and end products are duly entered in the stock registered and cleared on payment of duty - There is no evidence on record that no process was carried out on the rejected goods received by the appellant whereas, the appellant has produced documentary evidence to show that certain process were done which amounts to manufacture and cleared on payment of duty. - CENVAT credit on rejected and returned goods was correctly availed by the appellant. - Decided in favour of assessee. - App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned Advocate made the Bench go through various documents maintained by the appellant in the factory premises. That show cause notice was issued only on the ground that appellant has not maintained any records for the receipt of rejected goods in the factory as per Rule 16(1) of Central Excise Rules, 2002. It was his case, whether the activity carried out by the appellant amounts to manufacture or not, has been discussed by the first appellate authority, which is beyond the scope of the show cause notice. That no such allegations were made in the show cause notice. Learned Advocate relied upon the following case laws to argue that process of remoulding and adding of certain additives to make PP Co-Poly Moulding again amounts to manufactu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not maintain any records/ registers for rejected and returned goods as provided under Rule 16 of Central Excise Rules, 2002. However, it is observed from RG 23A Pt.I maintained by the appellant that entries have been made in this register regarding receipt of rejected goods in spite of the fact that no record has been specified under Rule 16 to be maintained by an assessee. The documents on the basis of which CENVAT credit is taken is also available with the appellant. The records maintained by the appellant is showing the issue slips for remanufacture of the goods and end products are duly entered in the stock registered and cleared on payment of duty. As per column No. 8 and 9 of RG 23 Part-I register, issue slip number, date and qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C., where the returned goods are subjected to a process amounting to manufacture, the manufacturer shall pay duty at the appropriate rate on the goods so manufactured, and for payment of such duty, the CENVAT credit of the duty paid on the returned goods could be utilized. 5.1 Further CBEC vide Circular No. 15/88-CX.3 dated 10.08.1988 also clarified that conversion of LDPE/HDPE moulding powder (granules) into moulding powder (powdered form) would amount to manufacture as per Note 6 of Chapter 39 of the Central Excise Tariff Act, 1985. 6. In view of the above factual position and the detailed accounts maintained by the appellant, it is held that CENVAT credit on rejected and returned goods was correctly availed by the appellant. Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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