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TMI Blog2016 (6) TMI 870X X X X Extracts X X X X X X X X Extracts X X X X ..... excisable goods, the provisions of Rule 6(3) (b) of Cenvat Credit Rules is not applicable to them. Held that:- Exempted goods are excisable goods, which stand exempted from payment of duty of excise leviable thereon. If no duty of excise is leviable on account of non-manufacture, the question of exemption of same does not arise. As such, goods cannot held to be exempted goods, thus making the applicability of Rule 6(3)(b) as nil. Rule 3 of Central Credit Rules allows a manufacturer or producer of final product, to avail the credit of duty paid on the inputs, which are to be used by them in the manufacture of final product. If there is no manufacturing activity involved, the said Rule debars the availment of credit at the ab initio st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harging any duty liability on the final product and the Cenvat Credit account was being maintained separately for different types of inputs. 3. With effect from 1999-2002, the appellants started availing cenvat credit on the entire common inputs used in the manufacture of dutiable products as also the products which did not attract duty. Such non-dutiable products were being cleared by them on payment of 8% of the value of the same in terms of provisions of Rule 6(3)(b) of Cenvat Credit Rules. 4. Revenue, by entertaining a view that inasmuch as the appellants final product i.e. galvanized wire and the other wires which emerges by the process of wire drawing are not excisable goods, the provisions of Rule 6(3) (b) of Cenvat Credit Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch products on payment of 8% of value of said products in terms of provisions of Rule 6(3)(b). It cannot be out of place to mention here that the said goods stand mentioned in the Central Excise Tariff attracting 16% duty on ad valoram basis. The appellants contention is that though the process adopted by them has been held to be non-manufacture, the fact that the said goods are specified in the schedule to the Central Excise Tariff, they are required to be held as excisable goods, in terms of provisions of section 2(d) of the Central Excise Act. As such, it is their submission that inasmuch as the goods are excisable goods, though emerging as a result of non-manufacturing activity, the provisions of Rule 6(3)(b) would be fully applicable a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be observed that appellant has not cleared their final product on full payment of duty of 16% in which case credit could have been allowed to them, as per settled proposition of law. 8. Having held that Rule 6(3)(b) is applicable only in respect of exempted products, we proceed to decide as to what are the exempted goods. The answer lies in the provisions of Rule 2(d) of Central Excise Rules which are as follows: Rule 2(d): exempted goods means excisable goods which are exempt from the whole of the duty of excise leviable thereon, and includes goods which are chargeable to Nil rate of duty; 9. As is seen from the above, exempted goods are excisable goods, which stand exempted from payment of duty of excise leviable ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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