CIR NO.721/37/2003-CX, DT. 06/06/2003
- Document type
- Circular
- Reference no.
- J
- Dated
Central Excise-Payment of duty on waste package/containers used for packing Modvatable inputs when cleared from the factory of the manufacturer availing Modvat/CENVAT credit
Central Excise-Payment of duty on waste package/containers used for packing Modvatable inputs when cleared from the factory of the manufacturer availing Modvat/CENVAT credit
2. The said appeal has now been decided by Supreme Court. The Apex Court has held that no duty could be demanded on the containers used for the packing of inputs, on which credit has been taken when cleared form the factory of the manufacturer availing credit as these containers could not be treated as scrap on waste arising out of the manufacturing process. Similarly, reversal of credit either on proportionate basis or otherwise is also not required as the utilization of input on which credit has been taken is not in dispute.
3. Accordingly, it is clarified that no duty shall be payable and no reversal of credit is also warranted on waste package /containers used for packing inputs, on which credit has been taken, when cleared from the factory of the manufacturer availing Modvat/CENVAT credit. Consequently, Circular No. 470/36/99-CX dated 19.7.99 may be treated as withdrawn. Pending cases if any, may be decided accordingly.
4. Trade and field formations may please be informed suitably.
Sd/-
(Vijay Mohan Jain)
Under Secretary to the Government of India