TMI Blog2013 (4) TMI 277X X X X Extracts X X X X X X X X Extracts X X X X ..... odvat scheme, it is the modvat of such final product which would have to include the cost of the inputs and in respect of which Modvat credit could be taken at the time of clearance of the final product and thus, in the facts of the present case, the Tribunal rightly rejected the contention of the Revenue that the respondents should have reversed the Cenvat credit taken before sending the goods to the job worker since the job worker had not followed the procedure of job work. No merit in the contention of the revenue that the job workers cannot prefer to pay excise duty in spite of having exemption notification bearing No. 214/86 exempting the job workers from paying duty in view of the mandatory provision of Section 5A(1A) of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before sending the goods to the job worker as the job worker had not followed the procedure for job work. 6. In these appeals, the Revenue has raised the following questions of law : (i) Whether the job workers can prefer to pay excise duty in spite of having exemption notification bearing no. 214 of 1986, exempting the job worker from paying duty, in view of amended provision of Section 5A(1A) of Central Excise Act, 1944 inserted w.e.f. 13-5-2005? (ii) Whether the Tribunal below committed error in not appreciating the aspect that it was case of sale and not a case of job worker, as finished material was sent back with invoice? (iii) Whether the assessee is availing dual benefit of credit by accepting the goods sent to job w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed floor plate assemblies by including the value of only the inputs put in by the appellant and adding thereto its service charges. By show cause notice dated February 22, 1994, the appellant in that case was called upon to show cause as to why it should not be charged with short-levy of excise duty for the period from February 28, 1993 to August 31, 1993 on the ground that value of TELCO s inputs in the assemblies should have been included in the assembly value of the assemblies. 10. The departmental authorities confirming the demand also levied penalty on the appellant after having negatived the contention that the demand was in any way barred by limitation. The Tribunal upheld the finding of the departmental authorities on the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in respect of those inputs nor could value of the inputs be added to the excisable value of the assemblies. 12. In such case, the Supreme Court made the following observations : We are of the view that the submission of the appellant is correct. The Tribunal appears to have been confused between the manufacture of the final product, namely, excavators and the manufacture of the intermediate product, namely, the floor plate assemblies. The scheme of Modvat permits the person who clears the ultimate final product to take the benefit of the Modvat scheme at the time of clearance of such final product. The manufacturer of the final product, in this case TELCO, would therefore, be entitled not only to adjust the credit on the inputs suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since the job worker had not followed the procedure of job work. It may not be out of place to mention here that that what was earlier provision contained in Rule 57F(2)(b) is exactly the present provision of Rule 4(5A) of the Cenvat Credit Rules, 2004. 14. We do not find any substance in the contention of Mr. Ravani that the job workers cannot prefer to pay excise duty in spite of having exemption notification bearing No. 214/86 exempting the job workers from paying duty in view of the mandatory provision of Section 5A(1A) of the Act. Similarly, we are also not impressed by the submission of Mr. Ravani that it was a case of sale and not the case of job work so as to attract the aforesaid principle laid down by the Supreme Court in the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
