2004 (11) TMI 202 - AT - Central Excise

Challenge to Duty Demand & Penalty Upheld by Commissioner (Appeals) Overturned for Job Workers

The challenge to duty demand and penalty affirmed by the Commissioner (Appeals) was based on the impugned order in the original. The appellants, ... Manufacturer Issues:Challenge to duty demand and penalty affirmed by Commissioner (Appeals) based on impugned order in original.Analysis:The appellants, functioning as job workers, received raw material under Rule 57AC and Notification No. 214/86, where the duty liability rested with the supplier who undertook to discharge duty on finished goods after job work completion. The absence of evidence indicating denial of finished goods receipt by the supplier absolves the appellants from duty demand. Additionally, no concrete proof of finished goods shortage on the appellants' premises was found. The balance in the RG.I register was nil and matched physical verification, suggesting no discrepancy. The ORG Systems v. CCE Vadodara case's application, where a job worker is considered a manufacturer, is deemed inapplicable here due to the specific circumstances of raw material receipt under the mentioned notification with the supplier's duty liability undertaking.In conclusion, the impugned order was deemed unsustainable. The appeals of both appellants were allowed, providing consequential relief as per the law.