TMI Blog2011 (8) TMI 621X X X X Extracts X X X X X X X X Extracts X X X X ..... f excise - Held That:- Tribunal rightly held that the MTRs do not constitute an integral part of the telephone, but are accessories on which duty is payable on clearance made by the appellant. Since appellant has availed duty credit on the inputs purchased and transferred to job workers for manufacture, appellant has to necessarily pay duty on the MTRs sold and adjust duty credit availed on the components by following Rule 57A extracted above.Appeal challenging the demand of duty is dismissed. - 28 OF 2010 - - - Dated:- 3-8-2011 - C.N. RAMACHANDRAN NAIR AND P.S. GOPINATHAN, JJ. Dr. K.B. Mohammedkutty and K.M. Firoz for the Appellant. Thomas Mathew Nellimoottil for the Respondent. JUDGMENT C.N. Ramachandran Nair. J. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure and return, is bound to pay duty on clearances i.e. at the time of sale. In fact, Rule 57A provides for adjustment of input tax credit availed against duty payable on the final product cleared from the factory. 2. Even though under the scheme above stated appellant availed duty credit on components of MTRs purchased and transferred to SSI units for manufacture of MTR units and received back the goods and sold along with telephone instruments and independently, appellant did not pay duty contending that the appellant is not the manufacturer. The Assessing Officer took the view that by virtue of the procedure followed by the appellant provided under Rule 57F(2) and the duty credit availed on inputs purchased and transferred to SSI units ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l appearing for the respondents relied on the decision of the Supreme Court in Ichalkaranji Machine Centre (P.) Ltd. v. Collector of Central Excise AIR 2005 SC 1139, in Chandrapur Magnet Wires (P.) Ltd. v. Collector of Central Excise 1996 (81) ELT 3 and the decision of the Rajasthan High Court in Kamra Bottling Co. v. CCE 2009 (233) ELT 329. 4. After hearing both sides and after going through the orders impugned, we are unable to accept the contention of the appellant that it has no liability to pay duty by virtue of the reversal of credit taken on inputs purchased and transferred to job workers for manufacture and return of MTRs. This is because the appellant by adopting the procedure prescribed under Rule 57F declared itself as the pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of this section and the conditions and restrictions that may be specified in the Notification." What is clear from the above Rule is that the duty credit availed on inputs is only for adjustment against duty payable on the final product manufactured and sold. When the appellant claims credit of duty paid on inputs purchased, it is the duty of the appellant to adjust the duty credit availed on inputs against duty payable on the sale of the final product which in this case is MTR. During hearing of the matter, we queried with the department as to whether the job workers were assessed for the duty payable on MTRs which admittedly were manufactured by them. The department after verifying facts submitted that job workers who man ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
