TMI Blog2013 (4) TMI 619X X X X Extracts X X X X X X X X Extracts X X X X ..... e and we do so. - As regards the penalties imposed on the appellant as well as the individuals, we find that as bulk of the demand is being set aside on the merits of the case itself, there is no reason for visiting the appellant with penalties under any Section or Rules. - Decided in favor of assessee. - E/2015-2017/2006 - A/973-975/2012-WZB/AHD - Dated:- 14-6-2012 - S/Shri M.V. Ravindran, B.S.V. Murthy, JJ. REPRESENTED BY : Shri Anand Nainawati, Advocate, for the Appellant. Shri J.S. Negi, AR, for the Respondent. [Order per : M.V. Ravindran, Member (J)]. These three appeals are filed against Order-in-Original No. 7/MP/2006, dated 14-3-2006. As these are arising out of same order, we dispose of by a common order. 2. The brief facts that arise for consideration are that the main appellant company is a manufacturer and is engaged in processing, involving bleaching and dyeing of 100% cotton yarn, on their own account as well as on job work basis for other manufacturers and are registered with the Excise authorities. A search was carried out in the factory premises of the appellant, on a follow-up of operation which was directed against M/s. Sheena Textiles (100 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty, did not avail the credit of Excise duty, paid on capital goods purchased during the period 1998-1999 to 2002-2003, though the goods manufactured on job work basis were liable to duty. After the product became dutiable, they filed a declaration with a specified period as per Rule 57J of Central Excise Rules, 2000/CENVAT Credit Rules, 2004 was prescribed, with the jurisdictional officers. It is his submission that the capital goods which were procured by the appellant were used also for the purpose of job work during the relevant period wherein the appellants have cleared the said goods on job work basis to principal manufacturer. It is his submission that it cannot be said that the said capital goods were used only for exempted product manufactured by them. He would submit that the adjudicating authority in Para 32 of the impugned order has specifically held that the CENVAT Credit of the inputs used in the manufacture of the goods on job work basis is allowed as the principal manufacturer is discharging the duty. It is his submission that the same analogy needs to be applied also to the capital goods credit. He would submit that the Larger Bench decision of the Tribunal in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise duty paid on such capital goods and as such is not eligible to claim CENVAT credit as per Rule 4(4) of Cenvat Credit Rules, 2002. It is his submission that the appellant has taken the depreciation of the Excise duty paid on the capital goods during the year when the same was purchased, they are deprived from availing CENVAT credit of Excise duty paid on capital goods. 5. We have given the due consideration to the submissions made by both sides and perused the records. 6. The undisputed facts are that the appellants were manufacturers, engaged in processing, involving bleaching and dyeing of the cotton yarn for their own goods and also were engaged in job working of the same for various principal manufacturers. It is also undisputed that the appellant, during the relevant period, working as job worker for the principal manufacturer, were using the job work challans/annexures for the purpose of such job work. It is also undisputed that the appellants were utilizing the CENVAT Credit of the inputs which were consumed/used by them during the relevant period for the manufacturing of the goods under job work for the principal manufacturer. It is also undisputed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... job worker i.e. processor. Thus, I find that the goods manufactured/processed by job worker on behalf of the parent manufacturer who ultimately pays the duty on the goods does not fall under the purview of exempted goods or goods chargeable to Nil rate of duty. Thus, the situation as envisaged is totally inapplicable in terms of Rule 6(2) of CENVAT Credit Rules, 2002 in relation to the concept of exempted goods. 8. It can be seen from the above reproduced paragraph that the adjudicating authority in one breath holds that the Central Excise duty paid on the inputs which are utilized for manufacturing of job work goods, is eligible to the appellant as such goods which are manufactured under job work are not exempted. At the same time, he denies the CENVAT credit of the Excise duty on the capital goods, holding that the capital goods were used only for exempted goods manufactured by them. It is undisputed fact in this case that the said capital goods/machinery which is used for manufacturing of final product of the appellant was also used for manufacturing of the job work goods for the principal manufacturer. We are unable to understand the conclusion of the adjudicating authority ..... X X X X Extracts X X X X X X X X Extracts X X X X
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