Non reversal of cenvat credit when process of manufacture held by court as not excisable – New Section 5B proposed to be put in effect
A new Section 5B was inserted in the Central Excise Act by the Finance Act 2007 to provide for non reversal of cenvat credit when the process of manufacture is held to be not excisable by the courts. There are several cases pending on this issue. See 14.05.2007 for a detailed analysis on the issue.
Now Board has realised that in the case of Metlex, the Supreme Court had held that Metallising or laminating of duty paid film does not amount to manufacture - 2004-TIOL-77-SC-CX. Apparently there are a large number of Show Cause Notices floating around on the issue. Board has called for particulars of notices issued to manufacturers and their customers. May be good times are ahead and Board will come up with a notification soon.
F.No. -3 dated June 1, 2007