Denial of CENVAT Credit for Non-Manufacture Activity: CESTAT Sets Aside Order as Duty Was Paid on All Goods

CESTAT (Customs, Excise, and Service Tax Appellate Tribunal) set aside an order denying CENVAT credit for "non-manufacture activity," ruling that "duty was paid on all goods." The tribunal found that the lower authority had incorrectly denied CENVAT credit on the grounds that the assessee was not involved in a manufacturing activity. However, CESTAT observed that duty had indeed been paid on all the goods, implying a taxable event. Thus, the denial of credit was unwarranted, as long as the inputs/services were used in relation to dutiable output.