2016 (1) TMI 381

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....nufacturer under job work challan issued under Rule 4(5)(a) of CENVAT Credit Rules, 2004, during the period 2003-04 to 2006-07 for manufacturing Fermenters/Columns on job work basis. The Appellants paid the duty on the clearance of the said goods to the principal. They filed refund claim of Rs. 39,30,563.00 on the ground that they are job worker and erroneously paid duty on clearance of job work material. The Adjudicating authority rejected the refund claim, which was upheld by the Commissioner (Appeals). 2. The learned Advocate on behalf of the Appellant submits that the Appellants received the material under the challan issued under Rule 4(5)(a) of the CENVAT Credit Rules, 2004 and after due process returned the goods to the principal ....

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.... payment of duty. According to the Appellant, they are not entitled to pay the duty on the job work material as it was received under Rule 4(5)(a) of CENVAT Credit Rules, 2004. The relevant portion of the said Rule 4(5)(a) is reproduced below:-  "(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 ....

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....anufacture of Pharmaceuticals or Chemicals. The Appellant received the Iron and Steel articles and manufactured fermenters/columns on job work basis which were not used in the manufacture of pharmaceuticals or chemicals. Apparently, it is evident from the records that the job work material were not used in the manufacture of final product of the principal and therefore, it is not covered under Rule 4(5)(a) of the said Rules. 7. The learned Advocate contended that the jurisdictional Central Excise officer of the job worker has no authority to question of the use of the material of the Principal. In support of his contention, he relied upon the various decisions. In the case of Vandana Dyeing Pvt. Ltd (supra), the Appellant received the fa....