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TMI Blog2016 (12) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... ng on fixture, powder coating, inspection, fine boring, deburring, gauging, thickness measurement, dimension inspection, application of rust preventive oil, champering, tapping, welding, drilling, notching, thread cleaning depending on the type of the product, after carrying out aforesaid process they are clearing the same to the manufacturer on payment of Excise duty. The adjudicating authority denied the CENVAT credit on the semi finished product on the ground that the appellant is not carrying out any manufacturing activity, therefore they are not entitled to the CENVAT credit. Accordingly the demand of CENVAT credit amounting to Rs. 57,51,712/- and equal amount of penalty under Section 11A of the Act was confirmed. Being aggrieved by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nished component is higher than the CENVAT credit availed on bought out semi finished goods, for this reason also the demand is unsustainable. He placed reliance on the following judgment:- (i) Prasad Films Laboratories Vs. Komal Metals Private Ltd [2001 (130) ELT 491 (Tri-Chennai)] (ii) Collector of Central Excise, Chandigarh Vs. Fine Packaging Private Ltd. [1995 (77) ELT 588 (Tribunal)] (iii) Commissioner of Central Excise, Indore Vs. M.P. Telelinks Ltd [2013 (287) ELT 101 (Tri-Delhi)] (iv) Commissioner of Central Excise & Customs, Aurangabad Vs. Fine Packaging Private Ltd. [2016 (335) ELT 117 (Tri. -Mumbai)] (v) Minda Auto Gas Limited Vs. Commissioner of Central Excise, Delhi [2013 (287) ELT 101 (Tri-Delhi)] (vi) Shree Rubber Plast ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... if the activity does not amount to manufacture the appellant is entitled for the CENVAT credit on receipt of semi finished goods on the basis of reissue of goods on payment of duty. This is permissible in terms of Rule 16 of the Central Excise Rules, 2002, which is reproduced below:- "Rule 16. Credit of duty on goods brought to the factory: (1) Where any goods on which duty had been paid at the time of removal thereof are brought to any factory for being re-made, refined, re-conditioned or for any other reason, the assessee shall state the particulars of such receipt in his records and shall be entitled to take CENVAT credit of the duty paid as if such goods are received as inputs under the CENVAT Credit Rules, 2002 and utilise this cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue that the appellant is not carrying out any manufacturing activity. Therefore the appellant is required to pay the duty equivalent to the CENVAT amount. However, the fact remains that the appellant has discharged the duty on the transaction value of on the processed goods, which is more than credit availed. Therefore in such fact the appellant is entitled for credit under the provision of Rule 16. We also take a note that the appellant has paid excise duty on the process component more than the amount of CENVAT credit of brought out goods. Therefore under these circumstances no demands exist, As per the above discussion, we are of the considered view that the appellant has rightly availed the CENVAT credit in respect of semi fini ..... X X X X Extracts X X X X X X X X Extracts X X X X
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