TMI Blog1997 (2) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... ut of the raw materials supplied by them. The appellants had got their classification list approved both in respect of the goods manufactured by them out of their own raw materials as well as in respect of the goods manufactured on job work basis. The appellants in respect of the goods manufactured on job work basis claimed benefit of Notification 214/86 and the classification list based on that was approved. The appellants however did not follow the procedure as envisaged under Notification 214/86 as their customers got the work manufactured on job work basis was not operating under the Modvat Scheme for the benefit of Notification 214/86 had been issued. 2. The learned Consultant for the appellants has pleaded that the appellants were l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al profit margin of 10% had been added to the value of the raw materials and the job charges charged and warranted. In that view he has pleaded that the order to this extent will have to be set aside. He has also prayed alternatively for reduction in the penalty levied. He has pleaded that in the facts and circumstances of the case confiscation of plant and machinery was not warranted. 3. Heard the learned JDR Shri S. Arulswamy. He has pleaded that the RT 12 returns were filed in respect of the goods manufactured by them on their own account out of their own raw materials and in respect of which the duty was paid and the clearances made on job work basis were not reflected in the RT 12 returns. He has pleaded mere filing of invoices canno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facilitate the movement of the goods where an assessee is operating under the Modvat Scheme and he wants to get certain goods manufactured or processed by job worker. In the present case the appellants were fully aware that the goods and the raw materials which they were receiving were not coming under the Modvat Scheme and the same were also not covered by the challans envisaged under Rule 57F the rule under which the movement of the goods from an assessee working under Modvat Scheme is provided for. When this was the position it was not understandable how the appellants can seek the cover of the approval of the classification list for clearance of the goods duty-free under Notification 214/86. Apparently they got this approval done with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 37B. The learned Collector we find in his order has not examined in depth the scope of these instructions and has also not spelt out on what basis the notional profit of 10% has to be added in the context of the manufacture of the goods on job work basis. We therefore hold that so far as the addition of notional profit is concerned the matter is required to be re-examined and we therefore for this limited purpose while upholding that the goods are liable to duty, remand the matter to the learned lower authority for de novo consideration and decision after affording the appellants an opportunity of hearing. In the facts and circumstances they are liable to penaly. However taking into consideration that the appellants are manufa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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