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CCE, Ludhiana Versus Rail Tech.

2017 (9) TMI 696 - CESTAT CHANDIGARH

CENVAT credit - job-work - respondents have taken the credit of same duty twice - N/N. 214/86-CE - Held that: - the issue whether the principal manufacturer can taken Cenvat Credit on the inputs contained in the goods received from the Job workers on which duty has been paid, is no longer res integra, and decided in the case of M/s. Bharat Heavy Electricals Ltd. Versus CCE & ST. - Meerut-I [2014 (3) TMI 203 - CESTAT NEW DELHI], where it was held that The intermediate products made out of inputs .....

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r the Respondent ORDER Per : Devender Singh The Revenue is in appeal against the impugned order. 2. The brief facts of the case are that the respondents are manufacturers of Railway parts falling under Chapter 86 of Central Excise Tariff. They took the Cenvat Credit of Central Excise Duty paid on Polycarbonate Sheet, which is one of the raw materials for their final products. The inputs were procured from M/s GE India Industries Pvt. Ltd. (M/s GEI), a registered dealer. The inputs were sent dire .....

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the duty on the inputs. Revenue felt that the respondents had wrongly taken Cenvat Credit on the strength of invoices of M/s GSC to the extent duty charged on the value of the material supplied by the respondents to M/s GSC. Thus the respondents had taken the credit of inputs twice. Accordingly, a show cause notice was issued to the appellant for recovery of duty ₹ 23,96,494/- and proposing equal amount of penalty along with interest. The case was adjudicated by adjudicating authority, who .....

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acting as independent manufacturer, the assessee should have supplied the raw material on invoice after payment/reversal of duty. He contended that the assessee has taken the double benefit of Cenvat Credit of duty on the Polycarbonate Sheets. He referred to the judgment of the Hon ble Apex Court in the case of International Auto Ltd. Vs. CCE, Bihar 2005 (183) ELT 239 (SC). He also relied on the following judgments:- 1. CCE, Ahmedabad I Vs. Rohan Dyes & Intermediaries Ltd. 2012 (284) ELT 48 .....

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ication. He relied on the following case laws:- 1. M/s Thermax Ltd. Vs. CCE, Vadodara-I 2015 (326) ELT 369 (Tri. Ahmd.). 2. M/s Bharat Heavy Electricals Ltd. Vs. CCE & St, Meerut-I 2014 (300) ELT 442 (Tri.-Del) 3. Aries Dyechem Industries Vs. CCE, Ahmedabad 2010 (257) ELT 113 (Tri. Ahmd.) 4. CCE, Ahmedabad-I Vs. Rohan Dyes & Intermediated Ltd. 2012 (284) ELT 484 (Guj.) affirmed by the Hon ble High Court. 5. CCE, Aurangabad Vs. Somaiya Organo Chem 2007 (213) ELT 130 (Tri. Mumbai). 5. Hear .....

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ication No. 214/86-CE dt. 25.03.1986. I find that the issue whether the principal manufacturer can taken Cenvat Credit on the inputs contained in the goods received from the Job workers on which duty has been paid, is no longer res integra. In a similar situation, in the case of M/s M/s Bharat Heavy Electricals Ltd. Vs. CCE & St, Meerut-I (supra) this Tribunal held as below:- 5. We have considered the submissions from both the sides and perused the records. 6. The appellant, had been receivi .....

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r being partially processed are sent to a job-worker for further processing, testing, repair, re-conditioning Tor for the manufacture of intermediate goods necessary for the manufacture of final products or any other purpose, and it is established from the records, challans or memos or any other document produced by the manufacturer or provider of output service taking the Cenvat credit that the goods are received back in the factory within one hundred and eight days of their being sent to a job .....

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inputs, can send those inputs to his job worker for further processing, testing, repair, reconditioning, etc. or for manufacture of intermediate goods necessary for the manufacture of final products or for any other purpose, provided the processed inputs or intermediate products are returned back within a period of 180 days. There is no condition that for availing the facility of this Rule, the job worker should avail full duty exemption under Notification No. 214/86-C.E. There is no dispute th .....

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ts of their own used by the said job workers for manufacture of the intermediate products. The Department seeks to deny the Cenvat credit of the duty on the intermediate product paid by the job workers on the ground that on the same inputs, Cenvat credit cannot be availed twice - first at the time of receipt the inputs by the Appellant in their factory from the input manufacturers and second time in respect of duty paid on intermediates goods made out of input supplied by Appellant upon receivin .....

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work basis for the principal manufacturer, in terms of the judgment of the Apex Court in case of Ujagar Prints v. Union of India, reported in 1989 (39) E.L.T. 493 (S.C.), they would be required to pay duty on the cost of input plus job charges including the cost of their own inputs used in manufacture. This is what the job workers have done in the present case. Moreover when the inputs, in question, have suffered twice, first in the hand of input manufacturers from whom the Appellant had procure .....

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inputs and just because the Appellant have availed Cenvat credit in respect of the inputs, the Cenvat credit of duty, if any paid on the intermediate products by the job workers, cannot be denied to the principal manufactures. 8. In view of the above discussion, the impugned order is not sustainable. The same is set aside and the appeal as well as stay application are allowed. The above decision has been followed by this Tribunal in the case of M/s Thermax Ltd. Vs. CCE, Vadodara-I (supra). I als .....

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ned SDR that the appellants have derived dual benefit. We are not able to see any dual benefit in this case. Based on the several matters which have come up before us, in this case if the job worker was to avail procedure of Notification No. 214/86 and clear the goods manufactured by him without paying duty, Department would have taken a stand that he has cleared the goods without payment of duty and therefore the materials which he has added by purchasing in the market would not be eligible for .....

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