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2015 (11) TMI 38 - CESTAT AHMEDABAD

2015 (11) TMI 38 - CESTAT AHMEDABAD - 2015 (326) E.L.T. 609 (Tri. - Ahmd.) - CENVAT Credit - Job works - Held that:- There is no dispute on the facts that the appellant received the fabrics under the cover of Central Excise Challans issued under Rule 57F(4) of the erstwhile Central Excise Rules and corresponding Rule of Central Excise Rules, 2012. The appellant after due process of fabrics returned the goods to the raw-material supplier, who used in the manufacture of finished products and clear .....

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of the erstwhile Rule corresponding to Rule 4 (5)(a) of the Cenvat Credit Rule 2002, permits the manufacturer to clear the goods to job worker without payment of duty for processing. There is no dispute that the job-work materials were used in manufacture of finished goods by the principal manufacturer, who cleared the goods on payment of duty. Thus, it is the case of Revenue neutral in so far as the payment of duty by the job-worker will enable the principal manufacturer to avail cenvat credit. .....

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holding Central Excise Registration Certificate. In the year 2001-02 and 2002-03, the appellants received fabrics for processing from two different parties for job work, accompanied with challans (i.e.. Annexure II) issued under Rule 57F(4) of the erstwhile Central Excise Rules, 1944. Rule 57F(4) is corresponding to provision of Rule 4(5)(a) of Cenvat Credit Rules, 2002. The appellants cleared the goods after processing to the supplier of the material under the cover of the Central Excise challa .....

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under show cause notice dtd 25.10.2004. Revenue filed appeal before the Commissioner (Appeals). By the impugned Order, Commissioner (Appeals) allowed the appeal filed by the Revenue and set aside the adjudication Order. Hence, the appellant filed this appeal before the Tribunal. 2. After hearing both the sides and on perusal of the records, we find there is no dispute on the facts that the appellant received the fabrics under the cover of Central Excise Challans issued under Rule 57F(4) of the .....

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fication No 214/86-CE dated 25/3/86 but received under Annexure II Challans issued under Cenvat Rules. In the show cause notice also, this fact has not denied. On mere reading of Rule 4(5)(a) of Cenvat Credit Rules, 2002/cenvat Credit Rules, 2004, I am convinced that the job-worker was entitled to receive inputs/semi-processed goods for job work and after completion of job work was permitted to remove the processed/semi-processed without payment of duty under Annexure II Challan to the principal .....

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facturer is allowed to take the Cenvat Credit again when the inputs/Capital Goods are received back in his factory. From the reading of whole text to Rule 4(5)(a), it is clear that the job workers are not required to pay any duty while sending the processed/semi processed goods to the principal manufacturer. In the Show Cause Notice, no such allegation relating to non-receipt of processed man-made fabrics from the job-worker or non payment of Central Excise duty on the ultimate finished goods by .....

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e inputs or on partially processed inputs in terms of provisions of Rule 57F(4) of the erstwhile Rule. In such cases, duty liability is required to be discharged by manufacturer and not by the job worker. Accordingly, the job worker is not eligible to avail credit in such situation. Larger Bench of the Tribunal in the case of M/s Sterlite Industries (I) Ltd vs. CCE, Pune - 2005 (183) ELT 353 (Tri.LB) held that duty on inputs used in the manufacture of final products cleared without payment of du .....

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