Custom, Excise & Service Tax Tribunal
M/S. Gsp Electronics vs C.C.E., Noida on 16 January, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
WEST BLOCK NO.2, R.K. PURAM, NEW DELHI 110 066
Date of Hearing 16.01.2014
For Approval &Signature :
Honble Mrs. Archana Wadhwa, Member (Judicial)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
No
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
No
3.
Whether Lordships wish to see the fair copy of the order?
Seen
4.
Whether order is to be circulated to the Department Authorities?
Yes
Appeal No. E/1893/2007 -EX[SM]
[Arising out of Order-in-Appeal No.25 to 27-CE/Appl/N/2007, dated 30.03.2007 passed by the C.C.E.(Appeals), Noida]
M/s. GSP Electronics Appellants
Vs.
C.C.E., Noida Respondent
Appeal No. E/1894/2007 -EX[SM] [Arising out of Order-in-Appeal No.25 to 27-CE/Appl/N/2007, dated 30.03.2007 passed by the C.C.E.(Appeals), Noida] Shri Gurdev Singh Appellants Vs. C.C.E., Noida Respondent Appearance Shri. Ravinder Singh, Consultant - for the appellants Shri BB Sharma, DR - for the respondent CORAM: Honble Mrs. Archana Wadhwa, Member (Judicial) Final Order Nos.50142-50143, dated 16.01.2014 Per Honble Mrs. Archana Wadhwa :
Both the appeals are disposed of by a common order as they arise out of the same impugned order of the Commissioner (Appeals). I have heard Shri Ravinder Singh, Consultant appearing for the appellant and Shri BB Sharma, Ld. Departmental Representative, appearing for Revenue.
2. As per facts on record, M/s. GSP Electronics are engaged in manufacture of transformers, coils and degaussing coils falling under Chapter 85 of the Central Excise Tariff Act, 1985. They were sending their raw-material, i.e., copper rods to their job workers M/s. S.H. Haryana Wires Ltd. for drawing and enamelling of the same in terms of Rule 4(5)(a) of CENVAT Credit Rules, 2001/2002 under the cover of challans and the job worker was returning the goods after completion of the job work to the appellant. As the job worker has used paint for enamelling of the goods, and charged the job charges including the cost of the enamel, they were paying duty on the said goods and the appellant was availing the credit of the duty paid by the job worker.
3. The Revenues contention is that the job worker should not have paid duty on the enamelled wires and as such the appellant is not entitled to avail the credit of the duty paid by the job worker. The Commissioner (Appeals) has also held that if the job worker has chosen to pay the duty on the processed inputs, he should have paid full duty in terms of the formula laid down by the Hon'ble Supreme Court in the case of Ujgar Prints Vs. Union of India & Others [1989 (039) E.L.T. 493 SC]. Accordingly, he has held that the duty paid by the job worker cannot be held to be duty paid by them and as such the appellant is not entitled to avail the credit of the same.
4. After appreciating the submissions made by both the sides, I find that admittedly, the job worker has discharged the duty burden on the value consisting of job charges and cost of enamel. If the Revenue is of the view that such discharging of duty by the job worker is on the lower side, they were free to raise the duty against the job worker. However, the issue in the present case is not related to same and the only law point required to be decided is as to whether the duty paid by the job worker is available to the appellant or not, as credit.
5. The Tribunal in the case of Treadsdirect Ltd. Vs. C.C.E., Calicut [2012 (286) E.L.T. 583 (Tri. Bang.)] has observed that the question of assessable value at the job worker cannot be charged at the end of the manufacturer of the final product and the manufacturer of final product would be entitled to the CENVAT credit of duty paid by the job worker. To the similar effect is the Tribunals decisions in the cases of SPIC (HCD) Ltd. Vs. C.C.E., Chennai-I [2006 (201) E.L.T. 386 (Tri. Chennai)], Collector of C.Ex., Vadodara Vs. Anupam Engineering Works [1999 (113) E.L.T. 497 (Tribunal) and Crocodile (India) Pvt. Ltd. Vs. C.C.E., Salem [2006 (205) E.L.T. 419 (Tri. Chennai)] .
6. I also find that the Hon'ble High Court of Punjab and Haryana in the case of C.C.E., Chandigarh Vs. Ranbaxy Labs Ltd. [2006 (203) E.L.T. 213 (P & H)] has held that the credit of duty paid by the job worker even though not required to be paid is available to the principal manufacturer. To the similar effect is the decision of the Hon'ble High Court of Mumbai in the case of C.C.E., Goa Vs. Nestle India Ltd. [2012 (275) E.L.T. 49 (Bom.)].
7. By following the ratio of the law declared in the above decisions, I hold that the appellant was entitled to the credit of duty paid by the job worker. Accordingly, the impugned order confirming the demand and imposing penalties on both the appellants is set aside and the appeals are allowed with the consequential relief to the appellants.
(Dictated and pronounced in the Open Court) (Archana Wadhwa) Member (Judicial) SSK -2-