Customs, Excise and Services Tax Appellate Tribunal (CESTAT): While dealing with an issue relating to payment of 6% on empty packaging drums of cenvatable input considering the same as non-excisable goods, Ramesh Nair (Judicial Member) held that the empty packaging material of cenvatable input is not liable for payment.CA appearing on behalf of the appellant submitted that the adjudicating authority and Commissioner (Appeals) confirmed the demand considering the drum as non excisable goods. He further submitted that the empty drums are not generated during the process of manufacture it is cleared after emptying the inputs therefore, the drums are cleared as such and the same is not liable for payment under Rule 6(3).
The Tribunal considered the submission made by both sides, perused the records and found that the lower authorities have confirmed the demand only on the ground that empty drums of cenvatable input is a non excisable goods and therefore, the clearance there of will attract 6% reversal in terms of rule 6(3) of Cenvat Credit Rules, 2004. The Tribunal further considered and reiterated the judgment of the Tribunal in Banco Gasket (INDIA) Ltd. v. CCE & ST, (2021) 8 TMI 77 which was also dealing with an identical issue. The Tribunal relied on the above judgment stating that the very identical issue has been considered and categorically held that empty packaging material of cenvatable input is not liable for payment either as excise duty or as Cenvat credit under Rule 6(3) of Cenvat Credit Rules, 2004.
The Tribunal allowed the appeal, setting aside the impugned order holding that the appellant is not liable to make any payment on clearance on empty drums.
[Cadila Healthcare Ltd. v. C.C.E & ST, Excise Appeal No. 10100 of 2020, decided on 24-06-2022]
Advocates who appeared in this case :
Shri Mitesh Jain, Advocate, for the Appellant;
Shri Vinod Lukose, Superintendent (AR), for the Respondent.
*Suchita Shukla, Editorial Assistant has reported this brief.