Custom, Excise & Service Tax Tribunal
M/S Sree Lakshmi Industrial Forge vs The Commissioner Of Central Excise on 30 April, 2013
THE CUSTOMS EXCISE AND SERVICE TAX APPELLATE TRIBUNAL,
SOUTH ZONAL BENCH, WTC BUILDING, FKCCI COMPLEX,
K.G. ROAD, BANGALORE
Date of hearing: 30.04.2013
Date of decision: 30.04.2013
Application No: E/St/ 280/2012,
Appeal No: E/463/2011
(Arising out of order-in-appeal No. 372/2010-CE dated 28.12.2010 passed by the Commissioner of Central Excise(Appeals), Bangalore)
For approval and signature
Honble Mr. P.G. Chacko, Member (Judicial)
Honble Mr. B.S.V. Murthy, Member(Technical)
1.
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules 1982?
No
2.
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules 1982 for publication in any authoritative report or not?
No
3.
Whether Their Lordships wish to see the fair copy of the Order
Seen
4.
Whether Order is to be circulated to the Departmental authorities
Yes
M/s Sree Lakshmi Industrial Forge
& Engineers Ltd. ....Appellant
Vs.
The Commissioner of Central Excise
Bangalore Respondent
Present for the Assessee : Mr. B.N. Gururaj., Adv Present for the Revenue: Mr. N. Jagadish, A.R. Coram:
Honble Mr. P.G. Chacko, Member (Judicial) Honble Mr. B.S.V. Murthy, Member(Technical) ORDER No______________________ (Per B.S.V.Murthy)The appellant is engaged in the manufacture of steel forgings. They manufactured steel forgings on their own account as well as on job work basis availing the benefit of Notification No. 214/1986-CE dated 25.3.1986. Proceedings were initiated for recovery of CENVAT Credit availed by them on furnace oil on the ground that it was a common input for exempted goods and dutiable goods and therefore the appellant should have maintained separate accounts or paid 10% on the forgings manufactured by them on job work basis. After being informed, the appellant reversed the credit attributable to forgings cleared on job work basis amounting to Rs. 1,67,117/-. However, the demand for an amount of 10% of the value of forgings as contemplated under Rule 15(2) of CENVAT Credit Rules amounting to Rs. 25,11,810/- has been confirmed and penalty equal to this amount has been imposed.
2. At the outset, it was submitted by the learned counsel that the issue is covered by a decision of the Larger Bench in the case of Sterlite Industries (I) Ltd. Vs. Commissioner of Central Excise, Pune [2005 (183)ELT 353(Tri-LB)] and therefore the appellant is eligible to avail the benefit of CENVAT credit on furnace oil utilized by them in respect of forgings manufactured on job work basis. We find that this submission is correct and therefore we waive the requirement of predeposit and proceed to decide the appeal itself. Since the issue is covered by a decision of the Larger Bench, final decision need not be postponed as submitted by the learned counsel. In the case of Sterlite Industries India Ltd.,(supra), this Tribunal held that where goods are manufactured on job work basis, the product cannot be considered as exempted goods since ultimately duty is paid by the principal manufacturer on the finished goods. This decision has been followed subsequently in several decisions by the Tribunal. In this case also, CENVAT credit of duty paid on furnace oil has been availed on dutiable forgings as well as forgings cleared on job work basis and therefore, the issue is covered by the decision of the Larger Bench. Accordingly, the appeal is allowed with consequential relief if any to the appellants.
(Pronounced and dictated in open court.)
(B.S.V.MURTHY) (P.G.CHACKO)
Member(Technical) Member(Judicial)
pnr
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