TaxTMI 
TaxTMI 
2023 (6) TMI 1
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....ed to be recovered under Section 11A(2) of the Central Excise Act, 1944. b. Interest at appropriate rate on the rebate amount already sanctioned and paid to them is ordered to be recovered under section 11AB of the Central Excise Act. c. Penalty of Rs 14,42,587/- (Rupees Fourteen Lakhs Forty Two thousand Five Hundred and Eighty Seven Only) is imposed under section 11AC of the Central Excise Act, 1944. d. Penalty of Rs 1,00,000/- (Rupees One Lakh only) is imposed on Shri Dinesh H Shah, Managing Director, M/s Ardh Metal and Alloys Pvt Ltd under Rule 26 of Central Excise Rules, 2002. 2.1 Appellant is engaged in manufacture of excisable goods namely Ferrous and Non Metals in various shapes and sizes i.e. Copper, Brass, steel in Rods, Bars, Profiles, Pipes, Tubes etc. they avail CENVAT credit as admissible in law. 2.2 Appellants were receiving copper scrap from their customers for conversion in Rods/ Bars/ Profiles/ Pipes/ Tubes etc. Appellant was getting scrap converted into copper strips/ plates/ bars on job work basis and then converting them into Rods/ Bars/ Profiles/ Pipes/ Tubes etc, by further processing in their premises. During the process of conversion from scrap t....
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.... In case of Welspun India Ltd [2009 (248) ELT 898 (T-Ahmd) it was held that goods cleared from the job workers premises were at par with normal clearance except shifting the duty liability to be discharged on these goods at the hands of principal manufacturer. Impugned order wrongly distinguishes the above referred order. The decisions relied upon in the impugned order against the appellant are distinguishable and not applicable to the facts of present case. There was no intent to evade payment of duty. the demand made alleging improper valuation at the hands of job workers is revenue neutral. the demand is mostly time barred. 3.3 Arguing for the revenue learned authorized representative reiterates the findings recorded in the impugned order. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 Following findings have been recorded in the impugned order. 4.3 The entire case of clandestine clearance has been made against the appellant in respect of the goods cleared by the appellant on the proper documents as per rule 4(5) of the CENVAT Credit Rules, 2004 or duty paying documents without establishin....
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....duct should be exempted, which situation can arise only when there is an exemption notification issued under Section 5A of the Central Excise Act or the final product is chargeable to nil rate of duty. Expression chargeable to nil rate of duty or exempted from whole of duty was considered by the Tribunal in the case of Orissa Synthetics Ltd. v. Collector of Central Ex. [1995 (77) E.L.T. 350 (Tri.)] and after taking note of the Ministries clarifications issued vide Circular No. 10/75/CX. 6, it was held that clearance under goods under provision of 191BB for export without payment of duty would not get covered by the above expression. Reference was made to the advice received from the Ministry of Law dealt in the paragraph of 9 in the said decision. It was opined in the said letter of the Law Ministry that the term 'exempted' has a definite connotation. The same as attributed to the notification issued by the Central Government. Similarly, the chargeable to nil rate of duty would refer to the tariff rate being nil and the goods cleared in terms of provision of Rule 199BB would not be covered by the said expression inasmuch as the same are not chargeable to nil rate. In the present ca....
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.... the tractor. In such a case the parts would not be the final product. Thus Rule 57C would have no application. The mere fact that the parts are cleared from one factory of the Appellants to another factory of the Appellants would not disentitle the Appellant from claiming benefit of Notification No. 217/86-C.E., dated 2nd April, 1986. As stated above, the Notification itself clarifies that the inputs can be used within the factory of production or in any other factory of the same manufacturer." By applying the ratio of the above decision, it becomes clear that Modvat credit of duty paid on the inputs used in the manufacture of final product cleared without payment of duty for further utilisation in the manufacture of final product, which are cleared on payment of duty by the principal manufacturer, would not be hit by provision of Rule 57C. Inasmuch as, the matter stands decided by the Honourable Supreme Court, we would hold in favour of assessee. 5. As regards the decision in the case of Alpha Lavan laying down that the Modvat credit could be claimed in such a situation, we find the earlier decision of the Bajaj Auto was not followed. However, in view of the facts that the ....
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....een held: "6. It is thus, obvious that as far as the duty liability of a job worker in terms of Rule 57F(4) of Central Excise Rules, 1944 is concerned, it is settled upto the level of Supreme Court that the job worker was not required to pay duty. We have reproduced above the provisions of Rule 57F(4) of Central Excise Rules, 1944 and the Provisions of Rule 4(5)(a) of the Cenvat Credit Rules, 2004 and have carefully perused the same. The language in both these Rules gives no scope to infer that if the job worker was not required to pay duty in terms of Rule 57F(4) it could be required to pay duty in terms of Rule 4(5)(a) because the conditions of Rule 57F(4) of Central Excise Rules, 1944 were stringent compared to the conditions of Rule 4(5)(a) of the Cenvat Credit Rules inasmuch as Rule 57F(4) categorically required the principal manufacturer to use the goods received from the job worker for further use in the manufacture of the final product or removing after payment of duty for home consumption or removing the same without payment of duty for export while Rule 4(5)(a) does not say so expressly though it is implicit therein. Thus, we are of the view that for the purpose of duti....
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....of liability to pay duty is concerned. However, this issue is not of relevance for this appeal because the demand has been raised within the normal period of one year." 4.7 Circular No 54/88-CX dated 01.10.1988 relied in the impugned order, was in context of the rule 173H/173L of the erstwhile Central excise Rules, 1944 and has no application to the facts of the present case. 4.8 Even if for a moment it is held that appellant has undervalued the goods cleared on job work basis under Rule 4 (5) to the principal manufacture then also it will have no impact on the revenue. The duty so short paid will be compensated at the time of clearance of processed goods by the principal manufacturer. Tribunal has in case of SRF Ltd [2007 (220) ELT 201 (T-Chennai) has held as follows: "7. We have carefully considered the case records and the submissions by both the sides. We find that though the facts of the case before us are slightly different as pointed out by the learned SDR, the ratio of the decision of the Apex Court in the International Auto Ltd. case is applicable to the instant case. The Apex Court had made it clear that when supplier of intermediate product and the manufacturer of f....
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....Jay Yuhshin did not include the value of free supplies for valuation of the intermediate products supplied to MUL. Jay Yuhshin had also taken credit of duty paid on the free supplies. The Tribunal decided that Jay Yuhshin should pay duty on the value of intermediate goods including the value of free supplies and upheld the demand and penalty. Following the above decision Delhi Bench of this Tribunal had passed the order in Jay Yuhshin Ltd. v. C.C.E., New Delhi reported as 2001 (137) E.L.T. 1098 (Tri-Del) affirming the demand and penalty (though reduced the quantum). At the time of hearing of Jay Yuhshin's appeal before the Tribunal, the DR had stated that the intermediate manufacturer would use the credit attributable to such free supplies for clearing other products (implying that it was not intended under the scheme). While disposing the Civil Appeal filed by Jay Yuhshin against this order the Apex Court had set aside both the demand and the penalty. 10. The facts of the above case are identical to those of the case on hand except that the goods had not moved to SRF under documents prescribed in Rule 57F(4). The free supply of dipping chemicals indicate the arrangement between....