‘When department has collected Excise duty on finished products, credit availed on the inputs cannot be denied, even without manufacture’: CESTAT

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has ruled that credit availed on inputs cannot be denied even if the finished products are not manufactured, provided excise duty has been collected on the finished products. The case involved a dispute over the eligibility of input credit when the finished products were not manufactured. The CESTAT clarified that as long as excise duty is paid on the finished products, the input credit cannot be denied. This decision is significant for manufacturers as it ensures that they can claim input credit even in cases where the manufacturing process is incomplete. The ruling emphasizes the principle that the payment of excise duty on finished products validates the eligibility for input credit. This judgment provides clarity on the treatment of input credit in excise matters and helps manufacturers manage their tax liabilities more effectively.