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Bharat Heavy Electricals Ltd. Bharat Heavy Electricals Ltd. Versus CCE & ST, Bhopal

2016 (12) TMI 30 - CESTAT NEW DELHI

Job-work - CENVAT credit - BHEL have not received back the inputs supplied to job workers fully. It is the case of the department that certain quantity of inputs viz. continuous cast copper rods, on which cenvat credit has been availed by BHEL supplied to the job workers, has not been fully accounted for and received back by BHEL and hence, there is a violation of provisions of Cenvat Credit Rules, 2004 - Held that: - BHEL have categorically asserted that there will certainly be a process loss a .....

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nufacturer, off-cuts and the copper scrap, which is not useable for the intended purpose or further use by the principal manufacturer, are retained by the job workers and have been put to profitable use in further manufacture of various other items. These manufactured items have been cleared on payment of proper central excise duty at the job worker's end. This has also not been disputed. In such situation, we find that there is no justification for reversal of any credit availed on inputs by BH .....

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n of manufacturing process at the job worker's end and the emergence of off-cuts and other waste products, which is not useable to the same intended purpose further by the job worker. - Appeal allowed - decided in favor of appellant. - Excise Appeals Nos.60490/12013 and 50212/2014 - Final Order No.54620-54621/2016 - Dated:- 28-10-2016 - Mr. (Dr.) Satish Chandra, President And Mr. B. Ravichandran, Member (Technical) Shri Z.U.Alvi and Shri Udit Jain, Advocates for the appellant. Shri Yogesh Ag .....

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ob workers under the cover of central excise challan for conversion into intermediate products such as bare copper conductors, Mica taped conductors in term of Rule 3 (1) of Cenvat Credit Rules, 2001 read with Notification No.214/86-CE dated 25.3.1986. 2. The issue involved in the present appeals is that BHEL have not received back the inputs supplied to job workers fully. It is the case of the department that certain quantity of inputs viz. continuous cast copper rods, on which cenvat credit ha .....

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ivalent amount was also imposed along with penalty of ₹ 5 lakhs on BCPL. The copper rods seized in the premises of the job worker was also ordered to be confiscated with option to redeem the same on payment of fine. 3. Ld. Counsel for the appellant submitted that as per Standard Rate Contract with various job worker, the waste and scrap including off-cuts generated during the course of job work are to be retained by the job worker to be cleared by them on payment of appropriate duty after .....

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ob worker's premises was not Virgin Continuous Cast Copper Rods. No test has been conducted, neither the goods were examined technically before arriving at the conclusion that these are inputs themselves. 4. Ld. AR reiterated the findings in the impugned order. He submitted that in terms of Cenvat Credit Rules, the inputs are to be used for the intended purpose. In the present case, the credit availed for copper rods sent to the job worker were not received back in full. The credit on copper .....

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accounted for. We find that BHEL have categorically asserted that there will certainly be a process loss and also emergence of scrap in the form of off-cuts and other pieces. BHEL requires the product with a particular specification and length. The generation of such specified intermediate products will result in certain end cuttings and also certain process loss. This much cannot be disputed. It is also not disputed that there will be certain conversion loss as no process can be undertaken on .....

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