TaxTMI 
TaxTMI 
2011 (1) TMI 95
X X X X Extracts X X X X
X X X X Extracts X X X X
....in manufacture of various types of balls and roller bearings falling under Chapter 84 of First Schedule to Central Excise Tariff Act, 1985. They were availing the benefit of CENVAT Credit of duty paid on the inputs i.e. seamless tubes and steel bars. After availing the CENVAT Credit, the said inputs were being supplied to job worker for carrying the requisite intermediate processes. During the course of such intermediate processes, waste and scrap was also being generated at the end of job worker and the waste and scrap so generated was being sold by job worker and was not being returned by them to the appellant. However, the appellant was paying duty on such waste and scrap generated at the job worker end and sold by them by considering th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... factory, who were duty bound to clear the same on payment of duty. For better appreciation, we reproduce Rule 4(5)(a) of CENVAT Credit Rules. 4(5)(a) The CENVAT Credit shall be allowed even if any inputs or capital goods as such or after being partially processed are sent to a job worker for further processing, testing, repair, re-conditioning or for the manufacture of intermediate goods necessary for the manufacture of final products or any other purpose, and it is established from the records, challans or memos or any other document produced by the manufacturer or provider of output service taking the CENVAT Credit that the goods are received back in the factory within 180 days of their being sent to a job worker and if the input....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e goods. Inasmuch as, waste and scrap has arisen in the hands of the job worker, who was the manufacturer, duty liability, if any, can be demanded from the job worker only. 8. We find that the Commissioner has clarified in his impugned order that this is not a case of recovery of wrongly taken CENVAT Credit, so as to invoke the provisions of Rule 12/14 of CENVAT Credit Rules, 2002/2004. He has categorically held that this is a case of short levy of Central Excise duty, which can be demanded under Section 11A of Central Excise Act, 1944. Accordingly, he has invoked the extended period of recovery of differential duty not paid on the waste and scrap. 9. From the above discussion, it becomes clear that duty is being demanded by....
X X X X Extracts X X X X
X X X X Extracts X X X X
....worker within the specified time in terms of Notification No. 214/86-C.E., dated 25-3-1986 as amended r/w Rule 4(5)(a) of Cenvat Credit Rules? B. Whether scrap generated at the job worker end out of the processing of the inputs is required to be returned to the supplier and, if it is not returned back whether the supplier of inputs is required to pay appropriate Central Excise thereon? 3.Having heard rival parties and having examined the findings recorded in the order in original, it is not in dispute, that the assessee had paid duty on the scrap generated at the factory of the job worker for the period April 1999 to March 2000. There is no liability on the principal manufacturer-respondent after31st March 2000in view of amended Rule 57AC....