2012 (9) TMI 871

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....ed by M/s. Bharath Foundry and Engineering Works (BFEW for short) in the manufacture of ingots in the assessee's factory. The relevant show-cause notice was issued on 26.4.2002 demanding the said amount of duty on a quantity of 4,59,313 kgs of aluminium scrap valued at Rs.2,06,69,085/-, which was allegedly cleared to BFEW for job work. Show-cause notice alleged that the scrap should have been cleared on payment of duty in terms of Rule 57F(3)/57F(4)/57F(5) of the Central Excise Rules, 1944 when cleared to the job worker for conversion into ingots. It also demanded interest on duty under Section 11AB of the Central Excise Act besides proposing penalties under Section 11AC of the Act and under the Central Excise Rules. The assessee replied to....

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....quired materials and melting facilities would be provided by the appellant. The scrap was required to be melted within the melting shed of the appellant. The melting process was to be carried out under the direct supervision of the appellant's production supervisor. BFEW were required to deploy the required number of labourers depending upon the quantity of the scrap to be melted. BFEW would be paid labour charges at specified rates per kilogram of scrap melted. Apart from these provisions of the contract, the written submissions filed by the appellant before the Commissioner were clearly to the effect that the aluminium scrap generated during the course of manufacture of the final product in their factory was not cleared to any place outsi....