2000 (11) TMI 730 - AT - Central Excise

Appellate Tribunal rules in favor of job workers in duty liability case

The Appellate Tribunal CEGAT, New Delhi ruled in favor of the appellants in a duty liability case as job workers for fabric treatment. The Tribunal upheld ... Duty liability of job-workers - goods received under Rule 57F(4) for job-work - processing of fabrics by heat-setting and stentering followed by return to manufacturer - liability where processed goods are cleared by the manufacturer on payment of duty - application of Tribunal precedent in departmental appealsDuty liability of job-workers - goods received under Rule 57F(4) for job-work - processing of fabrics by heat-setting and stentering followed by return to manufacturer - Whether the appellants, as job-workers who received fabrics under Rule 57F(4), performed heat-setting and stentering and returned the fabrics to the manufacturers, are liable to pay excise duty. - HELD THAT: - The Tribunal accepted the Revenue's appeal against the Commissioner (Appeals) only to find that the Commissioner (Appeals) had correctly reversed the order-in-original relying on the Tribunal's earlier decision in M/s. D.K. Processors Pvt. Ltd. The departmental representative conceded that the question of duty liability of job-workers engaged in heat-setting and stentering of fabrics received under Rule 57F(4) and returned to the manufacturers had been settled by that Tribunal decision. Applying that precedent, the Tribunal held that a job-worker cannot be saddled with duty liability where the processed goods received under Rule 57F(4) are returned to the manufacturer who clears them on payment of duty. The impugned Commissioner (Appeals) order, which absolved the appellants of duty liability by following the said ratio, was therefore valid and free from legal infirmity. [Paras 5, 6]Appellants not liable to pay duty as job-workers for the fabrics processed in June, 1997 and returned to the manufacturers; Commissioner (Appeals) order upholding same sustained.Final Conclusion: The Revenue's appeal is dismissed; the impugned order of the Commissioner (Appeals) absolving the appellants of duty liability is upheld in view of the Tribunal's earlier decision relied upon. The Appellate Tribunal CEGAT, New Delhi ruled in favor of the appellants in a case involving duty liability as job workers for heat setting and stentering of fabrics. The Commissioner (Appeals) reversed the duty demand based on a previous Tribunal decision. The Tribunal upheld the Commissioner's decision, stating that job workers cannot be held liable for duty on goods returned to manufacturers. The appeal by the Revenue was dismissed. (Case Citation: 2000 (11) TMI 730 - CEGAT, New Delhi)