9911796707
TMI Blog2016 (7) TMI 986X X X X Extracts X X X X X X X X Extracts X X X X ..... re that M/s.Hinduja Foundries Ltd., the appellant herein, are engaged in the manufacture of Cast Articles of Iron and Aluminium falling under Chapters 73 and 76 respectively of the Schedule to CETA 1985. The castings are principally for manufacturing of motor vehicle parts. They availed credit for excise duty paid on inputs and capital goods. On 06.01.2006, a fire accident occurred in the appellant's Shoot Squeeze Auto Moulding Plant, which was imported by the unit from Frix Hansburg, Italy in 1991. Appellant claimed compensation from M/s.Oriental Insurance Co.Ltd. Chennai on which duty element involved on lost capital goods was worked out to Rs. 2,97,536/-. The appellant was issued a SCN dt. 7.2.2011 proposing to demand the credit invo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ail credit on the original equipment as no credit scheme was in force. He relies on the case law in CCE Bangalore Vs Tata Advanced Materials Ltd. 2011 (271) ELT 62 (Kar.) which upheld the Tribunal's order in Tata Advance Materials Vs CCE Bangalore 2009 (241) ELT 92 (Tri.-Bang.) holding that the assessee is not liable to reverse the cenvat credit for the goods destroyed. 3. Ld. AR reiterated the findings of the adjudication order. He submits that parts were imported to repair the old damaged capital goods; that the process of importation and repair does not amount to 'manufacture' of the final product. He submits that by receiving the insurance claim, the appellant got double benefit which is not permissble. 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owing the Hon'ble Supreme Court's judgement in Collector of Central Excise, Pune v. Dai Ichi Karkaria Ltd. reported in 1999 (112) E.L.T. 353 (S.C.), allowed the appeal of the assessee. The relevant paragraphs 5 & 6 of the Hon'ble Karnataka High Court judgement are reproduced as hereunder :- "5. The Supreme? Court in the case of the Collector of Central Excise, Pune v. Dai Ichi Karkaria Ltd. reported in 1999 (112) E.L.T. 353 (S.C.) at para 17 held 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 product immediately it makes the requisite declaration and obtains an acknowledgement ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearing the finished products from his factory. Accordingly, he utilised the cenvat credit and cleared the finished products. It is about three years after such payment, the capital goods were destroyed in fire. As the assessee had insured the said capital goods, he put forth a claim for payment of the loss sustained by him, which includes the payment of excise duty. The Insurance Company in terms of the policy has compensated the assessee. Merely because the Insurance Company paid the assessee the value of goods including the excise duty paid, that would not render the availment of the cenvat credit wrong or irregular. At the same time, it does not confer any sight, on the Excise Department to demand reversal of credit or default to pay t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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