TaxTMI 
TaxTMI 
2011 (9) TMI 139
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....r 37, 84 and 87 of the Central Excise Tariff. They sent out various types of cast articles for job work to various job workers for the purposes of machining/fettling, bending, or carrying out any other operation necessary for the manufacture of final product. The finished goods are removed from the premises of the job workers and directly sent to the customers in terms of the permission granted to them under Rule 4(6) of the CENVAT credit Rules, 2004. The aforesaid permission was granted subject to undertaking given by the appellant that the waste and scrap if generated at the job workers end would either be brought back or removed on payment of Central Excise duty from the premises of the job workers. During the scrutiny of records of the ....
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....rtment filed an appeal before the Commissioner (Appeals) on the ground that in terms of the permission given by the Asst. Commissioner under Rule 4(6) of the CENVAT Credit Rules, 2004, the appellant had given an undertaking that they would discharge the duty liability on waste and scrap generated at the job workers premises in case they failed to bring back such waste and scrap. Therefore, in terms of the undertaking given, the appellant are liable to discharge duty liability on waste and scrap generated at the job workers premises. The ld. lower appellate authority accepted the plea of the department and set aside the order of the lower adjudicating authority and held that the appellants are liable to pay excise duty on the waste and scrap....
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....it in the account current or in CENVAT account before the goods are cleared from the job workers premises. 4. The ld. counsel relies on the judgement of the Tribunal in Rocket Engineering Corporation 2005 (191) ELT 483 wherein the question arose regarding payment of duty on waste and scrap generated at the job workers premises when goods were supplied for job work under the provisions of Rule 4(5)(a) of the CENVAT Credit Rules, 2002. In the said case it was held that Rule 4(5)(a) of the CENVAT Credit Rules does not cover return of waste and scrap to the manufacturers premises and therefore demand of duty on waste and scrap on the principal manufacturer who is sending the goods for job work is not sustainable in law. The said decisio....
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....se, the apex held as follows:- Circulars and instructions issued by the Board, are no doubt, binding in law on the authorities under the respective statutes, but when the Supreme Court or the High Court declares the law on the question arising for consideration, it would not be appropriate for the Court to direct that the circular should be given effect to and not the view expressed in a decision of this Court or the High Court. So far as the clarification/circulars issued by the Central Government and of the State Government are concerned, they represent merely their understanding of the statutory provisions. They are not binding upon the court. It is for the Court to declare what the particular provision of statute says and it is ....
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....d scrap, then in terms of provisions of Rule 4(6) of the CENVAT Credit Rules, 2004, the appellant cannot renege on the undertaking given and therefore they are liable to pay excise duty on such waste and scrap. Therefore, the lower appellate authority is right in confirming the demand of duty on waste and scrap generated at the job workers premises and prays for upholding the impugned order. 6. I have carefully considered the rival submissions. The short issue for consideration is whether the appellant is liable for payment of duty on the waste and scrap generated at the job workers premises in terms of provisions of Rule 4(6) of the CENVAT Credit Rules, 2004 which has not been brought back to the appellant premises. The said rule r....
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....anner of payment of duty are governed by Rules 4 and 8 of the Central Excise Rules. They are not, in any way, altered or changed by the CENVAT Credit Rules, 2004 which deals with allowing of CENVAT credit. The CENVAT Credit Rules 2004 does not create any liability to pay excise duty under any of its provisions. It provides for reversal of credit in case the credit has been taken wrongly. Therefore, under rule 4(6) CENVAT Credit Rules, 2004 only such conditions can be prescribed which are in conformity with Rules 4 and 8 of the Central Excise Rules, 2002 and not conditions which are repugnant or contrary to the provisions of these rules. In Fag Engineering case (supra), it was held that no duty liability can be fastened upon the principal ma....