TaxTMI 
TaxTMI 
2014 (12) TMI 1033
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....s. 50,000/- was imposed on the assessee for their failure to follow the procedure. Penalty of Rs. 25,000/- was also imposed on Shri Amar Nath, Director of the assessee under Rule 209A of Central Excise Rules, 1944. 3. Department challenged the order before Commissioner (Appeals) but Commissioner (Appeals) upheld the order of original adjudicating authority. 4. Revenue did not accept Commissioner (Appeals)'s order as legal and proper and challenged it before Hon'ble Tribunal referring the following. (a) They referred to provisions of rule 57 F(6) (i) rule 57F(4), Rule 57F(6)(ii) ,57F(7), Rule 9(1), rule 53, rule 173F, rule 173G(4) indicating that goods cleared for job work have to be accompanied by proper job work challans. Goods have to be cleared for job work after debiting of amount of 10% of value of inputs/partially processed inputs. Of course, manufacturer was entitled to take credit on receipt of goods returned back to the factory. Since inputs/partially processed goods were not received, interest has also been proposed. Under the scheme of self removal, goods has to be cleared under....
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....s facts on record that movement of goods have taken place on the authority of private challans. These are not prescribed challans. No such movement is allowed under prescribed laws and procedures. Just because a verification report has been furnished by the jurisdiction authority, it cannot legalise a illegal act. How it could be ensured that goods on private challans only went to so called job worker and were not clandestinely diverted to some other parties. How a report can be given regarding receipt of goods back to factory on the basis of same private challans. It is well settled law that if there was laid down procedure for movement of exempt goods, any other mode cannot regularise exemption. If this type of violation of procedure is regularised then no assessee will follow the statutory rules which are binding and regulatory in nature. 10. Further it has been admitted by the respondents that no duty was paid or reversed towards removals for job works in contravention or erstwhile rule 57 F(6) (ii). It is also admitted fact that no records were maintained in respect of good sent for job work manifesting a thin line of distinction between goods removed clandestinely and good....
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....manufacturer shall be eligible to take credit of an amount debited under sub-rule (6) of Rule 57 (F) when the inputs or partially processed inputs are received back in full in his factory in the account maintained under sub-rule (7) of Rule 57 G; (viii) Rule 9(1) of Central Excise Rules, 1944 provides that no excisable goods shall be removed from any place where they are produced, cured or manufactured until the excise duty leviable thereon has been paid at such place and in such manner as is prescribed in the rules; (ix) Rules 52 A of Central Excise Rules, 1944, provides that no excisable goods shall be delivered from a factory or a warehouse except under an invoice signed by the owner of the factory or his authorized agent; (x) Rule 53 of Central Excise Rules 1944, provides that every manufacturer shall maintain a stock account in such form as the Commissioner may in particular case or class of cases allow and shall enter in such account, daily description or goods, opening balance, quantity manufactured, quantity deposited in the store room, quantity removed, payment of duty etc; (xi) Rule 57A of Central Excise Rules, 1944 provides that credit of duty paid on inputs ....
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....ains of records in the factory, and non-intimation to the Central Excise authorities no co-relation was possible. Total value of goods cleared by the party during the period from 1996 to 1998 without following the procedure under modvat rules comes to Rs. 85,07,881/-. In view of the above, I find force in the contention of Revenue that on the value of castings amounting to Rs. 85,07,881/-, no credit could be allowed. Further violation relating to non-reversal of 10% of value of goods purportedly sent outside factory for job work on private challans is also manifested. 14. Regarding demand of duty on clearance of castings without following job work procedure, I do not find force in revenues appeal as they have already accepted that all goods have came back. Once revenue itself is satisfied, no question of demanding duty arises. Of course, for violation of job work procedure and non-reversal of 10% of the value, penal provisions are attracted. However I do not agree with revenue for imposition to equal penalty considering that appellants were not aware about correct procedures. No mens-rea has been imputed manifesting their intention to defraud the revenue knowingly, thus equival....