By TIOL News Service

MUMBAI, JUNE 22, 2017: THE appellant is engaged in the manufacture of various types of cocoa and chocolates. During the period January 2003 to December 2003, the appellant cleared finished goods on a stock transfer basis. The appellant gave photo frames as a free gift along with the supply of Diwali institutional packs. On these duty paid photo frames, the appellant availed CENVATcredit.

The revenue sought to deny the credit so availed on the ground that the same is not used in or in relation to the manufacture of final product. Another issue is the deduction claimed (by the appellant) on account of interest on receivables to arrive at the assessable value.

The appellant is before the CESTAT and submits that on both issues the Tribunal has allowed the appeals vide following orders -

(i) Deduction on account of receivables – Tribunal's Order no. A/85074/17/EB dated 02.01.17 - 2017-TIOL-1142-CESTAT-MUM

(ii) On account of cenvat credit in respect of gift provided along with final product-

- CCE vs. Prime Health Care Products - 2010-TIOL-901-HC-AHM-CX

- Manik Machinery Manufacturers P. Ltd. - 2016-TIOL-1497-CESTAT-MUM

- Gujtron Electronics P. Ltd. - 2009-TIOL-2545-CESTAT-AHM

The AR reiterated the findings of the lower authority.

The Bench observed that the issue of deduction on account of interest on receivables has been decided in the appellant's own case (in their favour) by Tribunal's order - 2017-TIOL-1142-CESTAT-MUM.

As regards admissibility of CENVATcredit in respect of photo frames supplied along with final product, noting that the issue has been settled in favour in the various judgments cited by the appellant and the matter is no longer res integra , the impugned order was set aside and the appeal was allowed.

(See 2017-TIOL-2124-CESTAT-MUM)