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TMI Blog2018 (9) TMI 981X X X X Extracts X X X X X X X X Extracts X X X X ..... ved as such Rule 3(5) would come into application. There is clear distinction from Rule 3(5) from trading activity for the reason that the credit is not eligible on traded goods whereas credit under Rule is eligible on inputs used for the clearance of final products. Credit remains allowed - appeal allowed - decided in favor of appellant. - E/41218/2018 - Final Order No. 42416/2018 - Dated:- 14-9-2018 - Ms. Sulekha Beevi C.S., Member (Judicial) For the Appellant : Shri M. Saravanan, Consultant For the Respondent : Shri B. Balamurugan, AC (AR) ORDER The appellants are manufacturers of CNC machines and are availing the facility of CENVAT credit on inputs, capital goods and service tax credit on inputs service. On v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd on wrong interpretation of law. He relied upon the decision of the Tribunal in the case of Lakshmi ring travellers (CBE) Ltd. Vs. Commissioner of Central Excise, Coimbatore vide Final Order No. 42443/2017 dated 27.10.2017; Commissioner of Central Excise, Ghaziabad Vs. UP Telelinks 2015 (329) ELT 888 (Tri. Del.) and Commissioner of Central Excise, Ghaziabad Vs. Mahaveer Cylinders Ltd. 2016 (341) ELT 361 (Tri. All.). 3. The ld. AR Shri B. Balamurugan supported the findings in the impugned order. He submitted that the appellants were clearing the spare parts and consumables which were purchased from other manufacturers to the customers. The said activity is nothing but a trading activity. Hence having not maintained separate accounts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng and has directed the appellant to expunge the credit to the extent of the value of inputs removed by them. In fact, such removal of inputs from one factory to the sister unit under the excise law by reversing the credit cannot be considered as a trading activity requiring the appellant to reverse the CENVAT credit availed on input services. I find that the issue of show cause notice as well as the confirmation of demand is without any legal basis. The impugned order is set aside and the appeal is allowed with consequential relief, if any. 6. Similar view was taken by the Tribunal in the case of UP Telelinks (supra) and Mahaveer Cylinders Ltd. (supra) cited by ld. consultant for the appellant. Taking into consideration the facts of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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