9911796707
TMI Blog2023 (12) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel for the respondent/assessee. 3. Vide the said impugned order, the Tribunal has allowed the appeal filed by the respondent/assessee setting aside the Order-in-Original dated 26.09.2005 passed by the Office of the Commissioner of Customs and Central Excise, Hyderabad, in C.Ex.No:22 of 2005. The Commissioner vide the Order-in-Original dated 26.09.2005 held that the respondent/assessee had wrongly availed MODVAT/CENVAT Credit on the capital goods in contravention to the provisions of Rule 56Q read with sub-rule 57(R1) of Central Excise Rules, 1944, and also Rule 57AB read with sub Rule 57AD(3) of Rules, 1944, and also Rule 3 read with sub Rule 6(4) of CENVAT credit Rules 2001-2002 from LML under proviso to sub-section (1) of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purpose of manufacturing of SPM, the machines used for processing of rough crank cases for Mahindra and Mahindra i.e. the machines installed in NEF Line and 275DI Line were neither used in the manufacturing of SPM and GPM, nor were they required for the same. 7. It was the further contention of the appellant/Revenue that the assessee has procured some finished machinery on payment of duty from their sister unit situated at Bonthapally and the said machines were used for manufacturing of SPM and GPM. The Commissioner in the course of passing the Order-in-Original on 26.09.2005, decided the matter against the respondent/assessee. However, when the matter travelled before the Tribunal, the Tribunal upon careful consideration of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 25.03.1986 categorically exempts goods specified in column No.2 of the table annexed manufacturing in a factory as a job work and used in or in relation to the manufacture of a final product specified in column No.3 of the said table. 9. When we look into judgment passed by the Tribunal in the case of Commissioner vs. Sterlite Industries (I) Ltd. 2009 (244) ELT A89 (Bom.), we find that the judgment of the larger Bench of the Tribunal was relied upon by the learned counsel for the respondent/assessee when it had travelled to the High Court. The High Court while considering the judgment of the larger Bench of the Tribunal in paragraph No.3 held as under: "3. ... ... ... ... ... ... ... ... ... ...As such to attract the provisions of Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E.L.T. 145 (S.C.) wherein in paragraph Nos.6, 8, 10 and 11 it has been held by the Hon'ble Supreme Court as under: "6. It is the contention of the Respondent, which has been accepted by CEGAT, that Rule 57C would become applicable as the parts are cleared from one factory to another without payment of duty. In our view, this reasoning cannot be accepted. The underlined portion of the Notification, set out hereinabove, shows that the inputs may be used within the factory of production or in any other factory of the same manufacturer. Thus merely because parts are cleared from one factory of the Appellants to another factory does not make the parts the final product. It is not denied that the parts, which are manufactured from the duty pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid down therein fully applies to this case. 11. In this view of the matter, we set aside the impugned Judgment and the Order of the Commissioner of Central Excise. It is held that the Appellants will be entitled to Modvat credit on duties paid for the inputs used for manufacture of parts, so long as the parts are used in the manufacture of tractors on which duty is paid. We clarify that in respect of parts which are sold in the open market and/or used for manufacture of tractors on which no duty is paid, the benefit of the Notification No. 217/86-C.E., dated 2nd April, 1986 may not be available." 11. Both the aforesaid decisions were primarily based upon the Notification No.217 of 1986 which allowed the clearance of inputs to another f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "9. We find that in the present case, the manufacture of wiring harness is done at Unit-I. The inputs are sent by Unit-I to Unit-II, viz., the principal manufacturer to the respondent/assessee for manufacture semi-finished wiring harness and the job-worked goods are cleared under delivery challans and not on payment of duty. The respondent/assessee is availing the exemption under Notification No.214/86-Ce for the job work done by the assessee. 16. We find on fact that in this case also, the Tribunal was correct in holding that wiring harness was removed without payment of duty under job work procedure to the principal manufacturer and that semi-finished goods removed by the job worker from its unit to the principal, without payment of d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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