9911796707
TMI Blog2007 (6) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... off by a common order. 2. The relevant facts that arise for consideration are appellant is engaged in the manufacture of Aluminium Foils as per specification given by the customers. The appellants cleared the said Aluminium Foils on payment of appropriate duties to their customers. The customers of the appellant rejected few consignments for being off-specification. These goods are brought back by the appellant into the factory under the provisions of Rule 16 of Central Excise Rules, 2002. After the inspection of such rejected goods, appellant cleared those goods, which conformed to the specification of customers on payment of duty and cleared the balance as waste and scrap. The appellant availed Cenvat credit as per provisions of Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s nothing but a process of manufacture and hence there is no justification for the demand of the duty. He further submits that the clearances of the goods when initially took place were not of marketable goods and no duty was payable. The scrapping of finished goods received back from the customers end are duty paid and .hence the credit availed by them would be correct. It was submitted that, since duty was not payable on non-marketable goods the availment credit on refinished goods is within the law. He relies upon the decisions of the Tribunal in the case of DSM Anti-Infective India (P) Ltd. v. Commissioner of Central Excise, Chandigarh as reported in 2004 (165) E.L.T. 69 (Tri.-Del.) for the proposition that if the goods at customers e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... factory premises, the argument that the goods were non-marketable gets totally demolished. 5. Once goods are removed from the factory premises on payment of duty, the question of them being marketable or non marketable does not arise as duty is to be discharged all the goods on removal from the factory premises. Once such duty is paid on removal of the goods, the provisions of Central Excise Rules as regard the payment of duty are satisfied and in case, the duty paid goods are to be brought back for remaking, refining, reconditioning or for any other reason, it would be covered by Rule 16 of the Central Excise Rules, 2002. It would be relevant to read the said Rule :- "Rule 16. Credit of duty on goods brought to the factory. - (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to the rules. The provisions of Rule 16(2) very clearly indicate that, if the process to which the goods are put to, does not amount to manufacture than the amount of credit availed under Sub-Rule 16(1) has to be reversed. In the case before us, it is seen that the appellant avails credit of the entire amount of the duty paid on rejected final products, seeks to pay the duty only on the waste and scrap, which, at any stretch of imagination cannot be said to be arising out of a process of manufacture. We are of the view that the appellant cannot claim that the waste and scrap which arises from rejected goods, are due to the process of manufacture as there is no manufacture, involved in the process, as is explained by the appellant before ..... X X X X Extracts X X X X X X X X Extracts X X X X
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