TaxTMI 
TaxTMI 
2019 (8) TMI 314
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....ted. - 1,00,00,000/- 5. E/11337/2014 Shri Tushar Patel (Employee of Agro Pack Limited (UNIT-II) - 5,00,000/- 6. E/11338/2014 Shri Bipin Patel (Authorised Signatory - Agro Pack Limited) - 25,00,000/- 7. E/11339/2014 Shri Harish M. Patel (Prop. Agro Pack Limited) - 25,00,000/- 2. Ld. Counsel for appeal pointed out that M/s. Agro Pack Limited (hereinafter referred to as APL for short) is engaged in the manufacture of pesticides on job work basis for various principal manufacturers like BASF, M/s. Syngenta India Limited ((hereinafter referred to as SIL for short) and M/s. Syngenta Crop Protection Pvt. Limited (hereinafter referred to as SCPPL for short). The Appellant APL started manufacturing in their factory at Plot No. B-1, 227/1, GIDC Estate, Panoli (this unit is referred to as Unit-I by the Appellants in their normal course of business). In the said Unit-I, the Appellants were manufacturing goods on job work basis for BASF, SIL and SCPPL etc. The Appellants were receiving raw materials from the respective principal manufacturers under cover of invoices/bills of entry which were billed to them and shipped to address of the Appellants. The Appella....
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....ome cases) and goods are delivered from port to Unit-II of the Appellants. Though procedure of endorsement of bills of entry was discontinued, SIL/SCCPL were filing declaration with Commissioner of Customs wherein it was categorically declared that good are taken for use in manufacture at premise of Agropack i.e. Unit-IT and address of jurisdictional range office was also indicated. He pointed out that when inputs either locally procured or imported are received in the factory, the details are first entered in Gate Inward Register. Gate Inward register indicates the date of receipt of goods in the factory, Name of the Transporter who has delivered the goods, Lorry receipt or Challan Number under cover of which inputs have been consigned to the Appellants, the details of bill of entry or the sale invoices as the case may be. He pointed out that credit of excise duty/CVD paid on inputs pertaining to SIL or SCPPL is availed by the appellants in Cenvat register maintained by them for SIL or SCPPL. Each page of such register shows name of "Syngenta India Limited" on top and ECC No. of the appellants is indicated on each page. Separate registers are maintained only for the purpose of eas....
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....s Syngenta Crop Protection Pvt. Ltd., At Agro Pack, Plot No. B/155, GIDC, Ankleshwar; (v) M/s Agro Pack, 227/1, GIDC, Panoli; (vi) M/s Syngenta India Limited, A/c Agro Pack, Plot No. B/155, GIDC, Ankleshwar; (b) Cenvat Account register as well as RG-23A Part-II shows that Cenvat Accounts are maintained in the name of SIL and SCPPL who are not registered assessee at the said premises. (c) Raw materials / inputs on which CENVAT Credit had been availed were the property of SIL OR SCPPL and have not passed on to the Appellants and that the Appellants were not entitled for CENVAT Credit of the duty paid on invoices received by them. (d) Appellants were fully aware that they were not entitled for the Cenvat Credit for raw materials covered under these invoices. Accordingly, they have maintained Cenvat account in the name of the Principal Manufacturers i.e. SIL and SCPPL but later on, at the time of claiming of rebate, the records were tampered with and name of the Principal Manufacturers was erased by whitener and the name of the Appellants was stamped on the documents so as to show that duty has been discharged by the Appellants from its Cenvat account. Credit of Rs. 36,2....
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....redit must be issued in the name of the person availing the Cenvat credit or the ownership of the goods must vest in the assessee. Only requirement for availing of credit is that the inputs should be received in the factory of the manufacturer and that the said inputs should be used in or in relation to the manufacture of finished goods. Thus, ownership of inputs is not the relevant criteria for determining the eligibility for credit. He relied on the decision of the Tribunal in the case of Mahadev Industries vs. CCE - 2000 (115) ELT 452 (Tri). He argued that bills of entry for home consumption were filed by SIL/SCCPL and the name of Agro Pack was declared on such bills of entry (address of Unit-I continued to be referred by CHA). Though procedure of endorsement of Bills of Entry was discontinued, SIL/SCCPL were filing declaration with Commissioner of Customs wherein it was categorically declared that good are taken for use in manufacture at premise of Agropack i.e. Unit-II and address of jurisdictional range office was also indicated. He argued that credit cannot be denied merely on the ground that document is not in the name of job worker and has been filed by importer if the rec....
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....mula the appellants was required to avail cenvat credit. Even no formula has been referred in the show cause notice on the basis of which the demand of Rs. 36,20,302/- has been quantified. He also submitted that in terms of the provisions of Rule 3(7) of the Cenvat Credit Rules, 2004, the quantification of demand is not correct and hence required to be re-quantified. He further argued that entire demand is barred by limitation as the period involved in the instant case is February 2008 to October 2008 whereas the show cause notice has been served to the appellants in the month of March 2012. He submitted that job work for manufacture of pesticides and insecticides for SIL and SCPPL was done at Unit-I. At Unit-I the statutory records were maintained as were being maintained by the appellants during the period in question. The procedure followed by the appellants for availment of credit is the same as was followed in Unit-I. Therefore, the appellants were under bonafide belief that credit is available to them and they are rightly utilising the credit or payment of duty on finished goods. In their written submission, they also submitted two affidavits of Shri Sanjay Raut, one in the c....
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....) dated 09.10.1992 to manufacture products on behalf of SIL/SCPPL and comply with all legal provisions. He describes the procedure of accounting in following words:- "10. I say and submit that accounting process followed by the company is as under: (a) In books of the company, separate plant codes are created for each Job worker location. All the transactions related to the respective locations are accounted in the respective plant codes. Plant code for Agro Pack Unit-II is 4774. (b) The company issues purchase order to the supplier of all the raw material, packing material (domestic & Imported) which are required for job work at the Agro pack under the respective plant code in SAP. Against the said purchase order, the vendor supplies material on bill to ship to ship to basis, wherein material is delivered to the job worker‟s location (Agro pack manufacturing plant) and commercial invoice is raised on SIL, Head Office for payment. However the Excise Invoice is accompanied with the material which is raised on SIL A/c Agro Pack. (c) Since the invoices are raised on the company by vendors the company is maintaining records of such receipt job worker wise. Credit on i....
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....vat credit availed for these two clients. This was done to keep accounts of two clients separate. The Commissioner in his order has not disputed the fact that appellant were doing job work for SIL and SCPPL. It has also not been disputed that SIL and SCPPL were sending material to the appellant‟s premises for the purpose of job work. Another issue raised is that SIL/SCPPL have never applied for exemption under Notification No. 214/86-CE and were not registered with Central Excise. It is not understood as to why registration and availment of Notification No. 214/86-CE is necessary for all job-workers. This notification can be used by a registered manufacturer if he wishes to avail. If one does not wish to avail this notification there is no bar in sending goods for job work. In fact a lot of entities get their goods manufactured on job work without registration and without availing Notification No. 214/86-Central Excise In this perspective, reliance placed on by impugned order on the decision of Hon'ble Supreme Court in the case of Harichand Shri Gopal - 2010 (260) ELT 3 (SC) is totally out of context. The only ground on which the entire case has been built is that the C....
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....vade duty. Therefore, the Cenvat credit amounting Rs. 7,60,14,689/- availed and utilized is liable to recovered under rules 14 of Cenvat Credit Rules, 2004." We find that no investigation or verification of records has been done to ascertain if the goods were received in the factory and utilized for the purpose of manufacture of final product or not. The only requirement under the law to avail credit of duty paid on inputs is that the said goods should have suffered duty liability and should have been used in the production of finished goods which are liable to duty. In the instant case, no investigation whatever has been done to ascertain that the goods were received and utilized in the manufacture of goods. Whatever be the address in the invoice documents on the strength of which the credit has been availed, the credit cannot be denied if the goods are in fact received in the factory and utilized for the manufacture of finished goods. In this context, it is seen that the appellants are claiming that they have maintained relevant records of receipt and utilization of goods. It has also been claimed that in the bills of entry they have filed declaration with the Commissioner of C....