Job work clearance of intermediate inputs under Rule 4(6) remains permissible despite marketability of the goods.

Rule 4(6) of the Cenvat Credit Rules permits clearance of zinc hydroxide to a job worker for conversion into zinc oxide, with the finished goods cleared from the job worker's premises, where the goods are used in further manufacture and prior permission has been consistently granted without misuse. Mere marketability of the input does not by itself prevent it from being treated as an intermediate product or partially processed input. Refusal of permission solely because the assessee did not manufacture zinc oxide in its own plant was therefore unsustainable, and the clearance from the job worker's premises was allowable.

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Issues: Whether clearance of zinc hydroxide to a job worker for conversion into zinc oxide and subsequent clearance of the finished goods from the job worker's premises was permissible under Rule 4(6) of the Cenvat Credit Rules.

Analysis: The permission had been granted for several years without any finding of misuse or improper accounting. The disputed goods were used in the manufacture of zinc oxide by the job worker, and the fact that zinc hydroxide was marketable did not by itself exclude it from being treated as an intermediate product or partially processed input for the purpose of Rule 4(6). Refusal of permission on the ground that the assessee did not itself manufacture zinc oxide in its own plant was held to be unsustainable.

Conclusion: The refusal of permission was unjustified, and clearance of the finished goods from the job worker's premises was allowable under Rule 4(6).

Final Conclusion: The impugned order was set aside and the appeal was allowed, resulting in relief to the assessee.

Ratio Decidendi: A goods item used in further manufacture at a job worker's premises can be treated as an intermediate product or partially processed input for Rule 4(6) purposes, and prior consistent permission without misuse should not be withdrawn merely because the item is also marketable.

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