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TMI Blog2024 (4) TMI 372X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture or production of said goods, shall be reversed. Under the facts and circumstances, it is an admitted fact that the work in progress or semi-finished goods are no longer inputs. Thus, no case is made out of inputs removed as such from the factory on the destruction of WIP or semi-finished goods. In case of destruction of goods/inputs, the liability is restricted to reversal of Cenvat credit on such inputs only. The appellant is not required to reverse Cenvat credit on the inputs already issued for production forming part of WIP or semi-finished goods. The impugned order set aside - It is clarified that the appellant is not required to reverse the Cenvat credit of Rs.76,88,124/- with respect to inputs forming part of work in progress/semi-finished goods destroyed in fire - appeal allowed. - HON'BLE MR. ANIL CHOUDHARY , MEMBER ( JUDICIAL ) And HON BLE MR. A. K. JYOTISHI , MEMBER ( TECHNICAL ) Shri Y. Sreenivasa Reddy , Advocate for the Appellant Shri V. R. Pavan Kumar , Authorized Representative for the Respondent ORDER [ Order per : ANIL CHOUDHARY ] The appellant M/s Shivtek Industries Pvt Ltd is in appeal against demand of Cenvat credit of Rs.76,88,124/-, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is issued for further production for each particular application. Once the raw materials are blended, it cannot be used for any purpose other than the product which is intended to be manufactured. Hence blended material is to be treated as work-in-progress. The blending of oil is done from various storage tanks as per final characteristic of plasticiser namely flexibility, whiteness, shining, transparency, electrical resistance and clarity. Thereafter, oil from blending tank 1 12 (any one at a time) is taken through pump P3 and NRV2 and magnetic filter F12 to Melter 1 6 where steam received from SRAAC Ltd is used for heating with temperature indicator in each of the Melter. The oil is heated and tested and sent through pump P4 in reactors, which are either glass lined or lead lined 1 4. Here, chlorine gas through pipeline is added through header and reaction initiated and temperature of heated mass is controlled by cooling water. Thereafter, gas of HCL and Chlorine is sent to Buffer, Vent Cooler and to Condenser C and finally to primary absorber (scrubbing) through Knock out drum. Primary absorber and secondary absorber react with water and HCL gas and convert it to 31 36% of HCL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Chlorinated Paraffin is already granted by Joint Commissioner. b) Rs.18,026/- which is duty on HCL, a by-product is being allowed now. c) Though the oil in blending tanks is in WIP stage, since it had not reached the stage of manufacture, same is to be treated as inputs and hence, no remission applies to this and Rs.68,58,855/- being credit taken on the inputs is to be reversed. Further, the appellant himself and the CA in his certificate mentioned the blended material as raw material. d) Blended oil in Melters and Reactors is also to be treated as inputs and Rs.4,18,325/- being credit taken on inputs is to be reversed. e) HDPE Drums and MS Drums being packing materials, credit of Rs.2,70,818/- is to be reversed. f) ISO Resin is to be treated as input and hence Rs.6,188/- availed on the same is to be reversed. g) Excess credit of Rs.1,33,938/- reversed shall be claimed following procedure under Section 11B of the CE Act, 1944. 8. As no speaking order was passed by the Commissioner, the appellant was advised that no appeal may be filed in absence of a speaking order. Further the appellant by letter dated 26.12.2017, urged before the Commissioner that there is no requirement of rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ken on inputs if they are destroyed as such. Rule 3(5C) provides for reversal of credit availed on inputs used in manufacture of finished goods on which remission is allowed. There is no provision in CCR for reversal of credit availed on inputs destroyed after issue for manufacture and destroyed in WIP stage. e) This Tribunal in the case of Granules India Ltd vs CCE, Visakhapatnam [2019 (6) TMI 191-CESTAT Hyderabad] while discussing the CBEC Circular dt.09.12.2019 clearly held that the said circular has not cited any legal provision to demand reversal of credit on the inputs issued for processing and in WIP material and hence, no such demand can be made. f) It is also a settled legal position that once the inputs are issued for production and in process material is destroyed, there is no provision to demand for reversal of credit taken on inputs. The appellant cites the following decision in this regard: i) Granules India Ltd vs CCE, Visakhapatnam [2019 (6) TMI 191 CESTAT Hyderabad] ii) Monarch Self Adhesive Tapes Foams (I) Pvt Ltd vs CCE, Pune [2017 (9) TMI 1374 CESTAT Mumbai] iii) Big Bags International Pvt Ltd vs CCE, Bangalore [2017 (12) TMI 380 CESTAT Bangalore] iv) CCE, Chenn ..... X X X X Extracts X X X X X X X X Extracts X X X X
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