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TMI Blog2024 (1) TMI 669X X X X Extracts X X X X X X X X Extracts X X X X ..... inal No. BEL/EXCUS/000/COM/B.HR/006/14/CX dated 17.07.2014 passed by the Commissioner of Central Excise & Customs, Belgaum. 2. Briefly stated facts of the case are that the appellant are engaged in manufacture of medicaments falling under Chapter Heading No. 30 of CETA, 1985. They availed and utilized Cenvat Credit on inputs/input services including capital goods as per the provisions of Cenvat Credit Rules, 2004. They had manufactured medicaments (injections) and sold under their own brand name as well as manufactured on loan license basis for M/s Wallace Pharmaceuticals Pvt Ltd, M/s Indi Pharmaceuticals and M/s Bliss GVS Pharma Ltd using their brand name following the procedure laid down under the Central Excise Rules. On the basis of sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll not include any substance to which the provisions of Drugs and Cosmetics Act, 1940 do not apply. He has submitted that in the absence of compliance of the said two conditions, the benefits of exemption Notification cannot be made applicable for clearance of the said formulations manufactured by them on behalf of the loan licensees. 3.2 Further, he has submitted that the appellant had discharged duty on the said manufactured medicaments on loan license basis, hence denial of Cenvat Credit on the inputs, packing materials used in or in relation to the manufacture of said medicaments is contrary to the principle of law settled by the Hon'ble Bombay High Court in the case of CCE, Pune-III vs Ajinkya Enterprises - 2013 (294) ELT 203 (Bom.), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal products. 7. It is not in dispute that the Appellants are manufacturing formulations namely artesunate, artemether, arteether, dihydroartemisinin and artelinic acid on loan license basis for the licensors i.e. M/s Wallace Pharmaceuticals Pvt Ltd, M/s Indi Pharmaceuticals and M/s Bliss GVS Pharma Ltd. During the period in question, the appellant had cleared the said goods discharging appropriate duty as applicable to the said goods, whereas, the Department alleged that since the said goods are exempted absolutely by virtue of Notification Nos. 4/2006-CE dt. 01.03.2006 and 12/2012-CE dt. 17.03.2012, hence, discharging duty on the same be considered as a deposit and Cenvat Credit availed on inputs/input services, accordingly, is not admis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering the process undertaken resulting into manufacture and attracting duty, Cenvat Credit cannot be denied on inputs/input services if subsequently it is found to be not amounting to manufactured and hence, not excisable. The Hon'ble Karnataka High Court in Vishal Precision Steel Tubes & Strips Pvt Ltd „s case (supra), observed as follows: "5. We may usefully refer to the decision of the Bombay High Court in the case of Commissioner of Central Excise, Pune-III v. Ajinkya Enterprises [2013 (294) E.L.T. 203 (Bom.)], wherein, the Bombay High Court at paragraphs 8 and 9 observed thus :- "8. We see no merit in the above contentions. As rightly contended by the representative of the assessee appearing in person, till 1st March, 2005 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocess of pickling does not amount to manufacture. Therefore, during the relevant period, that is, during the period from 2nd March, 2005 to 31st December, 2005, it could not be said that the issue was settled and that the assessee paid duty on decoiled HR/CR coils knowing fully well that the same were not manufactured goods. If duty on decoiled HR/CR coils was paid bona fide, then availing credit of duty paid on HR/CR coils cannot be faulted". 6. The another decision of High Court of Gujarat in the case of Commissioner of Central Excise & Customs, Surat-III v. Creative Enterprises - 2009 (235) E.L.T. 785 (Guj.) at paragraph 6, it was observed thus :- "6. When one goes through the order of the first appellate authority, it is apparent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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