2019 (10) TMI 1597 - AT - Central Excise

Cenvat Credit Entitlement Upheld for Services in Manufacturing by Job Workers in Tribunal Decision.

Shri Ramniwas Saini, International Packaging Products Pvt. Limited Versus Commissioner of Central Excise & ST, Daman

The Tribunal set aside the impugned orders and allowed all appeals, confirming the appellant's entitlement to Cenvat credit for services used in ... Cenvat credit - services used in the course of manufacture of their goods by the job workers and the service was received at the job worker’s place - HELD THAT:- The very same issue has been considered by this Tribunal in the case of KKALPANA INDUSTRIES (INDIA) LTD., SHRI VISHAL RANKA, SHRI AJIJUL RAHAMAT KHAN VERSUS C.C.E. & S.T., SILVASA [2019 (7) TMI 2044 - CESTAT AHMEDABAD] wherein, by interpreting Rule 3 of Cenvat Credit Rules, it was held that input service used for job work, the Cenvat credit thereof is admissible to the principal. In view of the above, the issue is squarely covered - Therefore, the impugned order is set-aside - Appeals are allowed. Issues:Entitlement to Cenvat credit for services used in the manufacture of goods by job workers at their premises.Analysis:The judgment revolves around the issue of whether the appellant is eligible for Cenvat credit concerning services utilized in the production of goods by job workers at their premises. The appellant contended that the services were employed in or in relation to the manufacturing of their final products, which were partially processed at the job worker's premises. The appellant and job workers were part of the same company, further strengthening the claim. Reference was made to a previous Tribunal decision in a similar case to support the argument.The Revenue, represented by the Superintendent, upheld the findings of the impugned order, emphasizing the denial of credit. The Tribunal, after considering the arguments from both sides and examining the records, referred to a previous judgment involving the same issue. In that case, it was established that input services used for job work allowed the principal to claim Cenvat credit. The Tribunal highlighted the specific provision in Rule 3 of the Cenvat Credit Rules, emphasizing that the principal is entitled to credit for services used in the manufacture of job work goods, even if the job worker does not pay excise duty.The Tribunal concluded that since the entire job work was carried out exclusively for the appellants under the relevant rules, the services were undeniably utilized in or in relation to the manufacturing of the appellant's final products. Therefore, the appellants were deemed eligible for the Cenvat credit. The judgment set aside the impugned orders and allowed all the appeals, citing the clear entitlement of the appellant based on the legal provisions and precedents.In summary, the judgment clarifies the entitlement of the appellant to claim Cenvat credit for services used in the manufacturing process by job workers at their premises. The decision is based on a thorough analysis of the legal provisions, previous tribunal decisions, and the specific circumstances of the case, ultimately leading to the allowance of the appeals and setting aside of the impugned orders.