Tribunal Upheld Job Workers' Cenvat Credit Entitlement

The Tribunal upheld the impugned order rejecting the revenue's appeal regarding Cenvat Credit on furnace oil used in manufacturing job work goods. The High Court clarified that job workers are entitled to the credit even if the principal manufacturer pays duty on the final product. The dismissal of the revenue's appeal was upheld based on the clarification provided by the High Court, resulting in no fault found in the impugned order.

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Issues:
- Appeal against rejection of appeal by Commissioner (Appeals) regarding Cenvat Credit on furnace oil used in job work goods.
- Interpretation of the decision in Sterlite Inds. case by the Hon'ble High Court of Bombay.

Analysis:
- The appellant appealed against the impugned order where the Commissioner (Appeals) rejected the appeal filed by the revenue regarding the entitlement of Cenvat Credit on furnace oil used in manufacturing job work goods cleared without duty payment, but the final product incurring duty. The revenue contended that since the job worker used the furnace oil without paying duty, they are not eligible for the credit. The Adjudicating Authority dropped the show-cause notice, which was upheld by the Commissioner (Appeals) based on the Sterlite Inds. decision. The revenue challenged this decision, arguing that the High Court was reviewing the Sterlite Inds. case, making the dismissal premature.

- During the hearing, it was revealed that the appeal in the Sterlite Inds. case had been dismissed by the High Court. The High Court's decision clarified that if a job worker takes input credit on furnace oil for job work goods cleared duty-free, but the principal manufacturer pays duty on the final product, the job worker is entitled to Cenvat Credit on the furnace oil. Consequently, the Tribunal found no fault in the impugned order and upheld it, leading to the dismissal of the revenue's appeal.

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