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TMI Blog2023 (2) TMI 549X X X X Extracts X X X X X X X X Extracts X X X X ..... nt-M/s. Hansa Tube Pvt. Ltd. against the order dated 09.09.2005 (Annexure A-2) passed by the Commissioner & Central Excise Chandigarh, had been allowed. The respondent-company is engaged in manufacturing of Galvanized Plain Coils (G P Coils), Galvanized Plain Sheets ( G P Sheets) and Galvanized Corrugated Sheets (G C Sheets) falling under Chapter subheading 7210.19 and 7210.11 of the First Schedule to the Central Excise Tariff Act, 1935. During the audit of 2002-03 and 2003-04, the Central Excise Officer observed that the company had wrongly availed Cenvat credit to the tune of Rs.1,21,86,295/- on C.R. Coils and Zinc inasmuch as the said goods were used in the process of galvanization of C.R. Coils for conversion into G.P. Coils and the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,45,077/- (Rupees one crore seventeen lacs forty five thousand seventy seven only) upon Hansa Tubes Pvt. Ltd., Unit-II, Lalru (Derabassi) under Rule 13 of the Cenvat Credit Rules read with Section 11AC of the Act." The stand taken by the respondent before the Customs Excise & Service Tax Appellate Tribunal (in short 'Tribunal') was that C.R. Coils are basic raw material for G.P.Sheets as well as G.C.Sheets. Even if the process of conversion does not amount to manufacture in the Central Excise Act, the inputs can be cleared as such or after being partially processed on reversal of amount equivalent to credit availed on such inputs. With respect to demand of rebate claim amounting to Rs.88,71,269/- the stand was that as per Rule 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after referred to as the CENVAT credit) of (i) the duty of excise specified in the First Schedule to the Tariff Act, leviable under the Act; (ii) the duty of excise specified in the Second Schedule to the Tariff Act, leviable under the Act; (iii) the additional duty of excise leviable under Section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978); (iv) the additional duty of excise leviable under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957); (v) the National Calamity Contingent duty leviable under section 136 of the Finance Act, 2001 (14 of 2001); and (vi) the additional duty leviable under section 3 of the Customs Tariff Act, eq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o take credit as referred above. It is further clarified in sub rule (1) that the manufacturer of the final products shall be allowed CENVAT credit of additional duty leviable under Section 3 of the Customs Tariff Act on goods falling under heading 98.01 of the First Schedule to the Customs Tariff Act. However, sub rule (3) is relevant, which is as under:- (3) the CENVAT credit may be utilized for payment of any duty of excise on any final products or for payment of duty on inputs or capital goods themselves if such inputs are removed as such or after being partially processed or such capital goods are removed as such: Provided that while paying duty, the CENVAT credit shall be utilized only to the extent such credit is available on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd 'manufacturing goods'. Hence, in the present case, once the respondent had paid duty at the time of purchase of C.R. Coils and had taken Cenvat credit after galvanizing the sheets and took rebate of Rs.88,71,269/-, he could claim the benefit of Cenvat Credit deposited by him and this aspect has been considered by the High Court of Gujarat in the case of Commissioner of Central Excise vs. Delta Corporation 2013 (287) ELT 15 (Guj.). In that case, the High Court of Gujarat was examining the manufacturing activity of item called "P.D. Pumps" and after purchasing such pumps, the manufacturer availed Modvat credit under Rule 57A of the Central Excise Rules, 1944. The view of the revenue was that the assessee had purchased the P.D. Pump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er: "7. Apart from the fact that the assessee had satisfactorily established the nature of manufacturing processes to which these two items had undergone before they were removed on payment of excise duty on the value added basis, it is also not disputed that the total amount of excise duty paid was much higher than the Modvat credit availed in respect of these items. 7.1 Under the proviso to sub-rule (1) of Rule 57F, where the inputs were removed from the factory for home consumption on payment of duty of excise, such duty of excise shall be the amount of credit that has been availed in respect of such inputs under Rule 57A. Therefore, the rule contemplated removal of inputs in respect of which a credit of duty had been allowed wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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