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2015 (4) TMI 646 - AT - Central ExciseJob work - manufacture of fastners required bright wire rods out of bright bars - manufacturing activity or taxable services - Business Auxiliary Services - Rods used for manufacture of their finished products - Manufacturing activity or not - Held that:- M/s Juneja Bright Steels Pvt. Ltd. (Job worker) had obtained service tax registration treating their activity as Business Auxiliary Services, that is production of goods not amounting to manufacture and were paying service tax on the job charges and were also filing ST-3 return. Thus, it cannot be denied that the activity of M/s Juneja Bright Steels Pvt. Ltd. was known to the Department and the Department at that time was accepting the service tax from them. In view of this, just because subsequently the Department takes the view that the activity of M/s Juneja Bright Steels Pvt. Ltd amounts to manufacture and the bright wire rods manufactured by them would attract Central Excise duty, M/s Sundram Fasteners Ltd. cannot be accused of receiving the wire rods with knowledge that the same were non-duty paid and liable for confiscation. - prima facie view that the imposition of penalty on M/s Sundram Fasteners Ltd. under Rule 26 (1) is not sustainable and as such they have strong prima facie case in their favour. The requirement of pre-deposit of penalty by M/s Sundram Fasteners Ltd. for hearing of their appeal is, therefore, waived and recovery thereof is stayed. - Stay granted.
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