IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA Central Excise Reference No. 18 of 2001 Date of decision: 8.4.2009. Commissioner, Central Excise, Chandigarh … Petitioner. Versus M/s Eicher Tractors Ltd. and another. … Respondents. Coram The Hon’ble Mr.Justice Deepak Gupta, J. The Hon’ble Mr. Justice V.K.Ahuja, J. Whether approved for reporting?1 No. . For the petitioner: Mr. Sandeep Sharma, Assistant Solicitor General of India. For the respondent . Mr. Rakesh Sharma, Advocate. Per Deepak Gupta, J (oral) This Excise Reference has been admitted on the following questions of law:- “1. Whether the Hon’ble Tribunal was correct in treating party’s own final products returned by the customers during period 2/95 to 6/95, for re-processing, as inputs in terms of Rule 57-A of the Central Excise Rules, 1944 (as it stood during the material period), when these finished goods were subjected to the process of repair/reconditioning only and no process of manufacture was carried out on them? 2. Were these goods not appropriately covered under specific provisions of Rule 173H and Rule 173L of the Central Excise Rules, 1944?” The admitted facts are that the respondent No.1 was manufacturing axle-shafts, used in tractors, which it was supplying to its 1 Whether the reporters of the local papers may be allowed to see the Judgment? Yes. 2 sister units where the tractors were being manufactured. Some of the axle-shafts were returned being defective. These axle-shafts were refurbished/ reprocessed. According to the manufacturer, thereafter the manufacturer again sold the same as fresh products. The department took up the plea that the manufacturer could not claim modvat credit on resale of the refurbished products which have been returned to the manufacturer. The main ground raised by the department is that modvat credit, on account of the excise duty paid on the inputs, had already been claimed when the axle-shafts were first sold and therefore, on refurbished and reprocessed axle-shafts fresh modvat credit could not have been claimed. The authorities upto the level of Commissioner (Appeals) had accepted the plea of the department. The Customs, Excise and Gold (Control) Appellate Tribunal (CEGAT) vide its order dated 18th September, 2000 has allowed the appeal relying upon certain judgements but has given no independent reasoning of its own. The order passed by the learned Tribunal, to say the least, is absolutely cryptic and no reasons have been given. We are clearly of the view that the manufacturer must show that during the process of refurbishing or reprocessing either fresh material was used or that the entire process was started all over again resulting in manufacture. Even if there is manufacture but some of the parts used are those on which modvat credit has already been claimed, fresh modvat credit cannot be claimed again. It has been urged by Shri Rakesh Sharma, learned counsel for the respondent, that in fact the manufacturer paid full excise duty on the entire value of the refurbished axle and it is in these circumstances that it 3 claim modvat credit on the entire inputs. These are pure questions of fact which have to be decided by the CEGAT and cannot be decided by us in reference. We, therefore, set-aside the order of the learned CEGAT, remand the matter to it and direct the CEGAT to decide the case afresh in the light of the observations made here-in-above. ( Deepak Gupta ), J. 8th April, 2009 ( V.K.Ahuja ), J. ™