TMI Blog2012 (11) TMI 1031X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of duty - Held that:- The appellant in terms of their contract with BHEL for processing of copper wire bars into rectangular bars of specified size and dimensions on job work basis, were required to return 98% of the raw-material in process form, as in terms of the contract the burning loss of only 2% was permitted. There is no dispute that while BHEL were availing Cenvat credit in respect of wire bars sent by them to the appellant for job work, the appellant were operating under Notification No. 214/86-C.E. and sending the processed material to BHEL without payment of duty. In terms of Rule 57F(4) of Central Excise Rules, 1944, the waste arising in the course of the processing of material received from the principal manufacturer was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 005 - A/1347/2012-EX(BR)(PB) - Dated:- 29-11-2012 - Ajit Bharihoke and Shri Rakesh Kumar, JJ. Shri Z.U. Alvi, Advocate, for the Appellant. Shri M.S. Negi, AR (DR), for the Respondent. ORDER The appellant are manufacturer of Copper Wire and Rectangular Copper Bars chargeable to Central Excise duty. During the period of dispute they had a contract with M/s. BHEL for conversion of Copper Wire Bars into Rectangular Copper Bars with specified sizes and dimensions on job work basis. In terms of the contract, the appellant were required to return 98 Kg of processed material out of every 100 Kg of copper wire bars received from BHEL. The appellant were operating under Notification No. 214/86-C.E. and accordingly while BHEL were ava ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 493 (S.C.) i.e. on the basis of cost of raw-material plus job charges. On this basis, the show cause notice dated 13-12-2002 was issued to the appellant for demand of allegedly short paid duty amounting to Rs. 1,28,648/- during the period from 1-12-1997 to 31-12-2000 and also for imposition of penalty on them u/s 11AC and Rule 173Q. The Show Cause Notice was adjudicated by Assistant Commissioner vide Order-in-Original dated 28-11-2003 by which the duty demand as mentioned above was confirmed and besides this, while penalty of same amount was imposed u/s 11AC, penalty of Rs. 5,000/- was imposed on the Appellant under Rule 173Q. 2. On appeal being filed to Commissioner (Appeals), the above order of the Asstt. Commissioner was upheld vide or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le 57F and Notification No. 214/86-C.E., receives Cenvat credit availed raw-material from the principal manufacturer for job work and when in addition to the raw-material received from the principal manufacturer, he also uses his own raw-material in respect of which he has availed Cenvat credit, he is not required to reverse Cenvat credit in respect of his own raw-material while sending the processed material to the principal manufacturers without payment of duty. He pleaded that in view of the judgment of the Tribunal, the Cenvat credit in respect of the self procured copper wire bars was not required to be reversed and hence there is no question of demand of any duty. 4. Shri M.S. Negi, the learned departmental representative, defended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cured the duty paid copper wire bars from other manufacturers which were processed for conversion into rectangular bars and cleared to BHEL. The dispute is about these rectangular bars made out of wire bars procured by the appellant from outside. In our view, since the appellant were required to return 98 Kg of rectangular bars out of every 100 Kg of copper wire bars received from BHEL and the procurement of copper wire bars from outside to the extent of 16% was in lieu of the sale of copper waste to the extent of 16%, the copper bars procured from outside have to be treated as owned by BHEL and since Cenvat credit in respect of the same has been availed by the appellant, they would be liable to pay duty on the rectangular bars manufactured ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
