Customs, Excise and Gold Tribunal - Delhi
Kay Cee Electricals vs Commissioner Of Central Excise on 19 November, 2004
Equivalent citations: 2005(182)ELT136(TRI-DEL)
ORDER P.S. Bajaj, Member (J)
1. In this appeal, the challenge has been made to the impugned order in appeal by the appellants vide which the Commissioner (Appeals) has affirmed the order in original of the adjudicating authority which confirmed the duty demand of Rs. 56,752/- with equal amount of penalty on the appellants.
2. The learned Counsel has contended that the appellants are only job worker and they receive the raw material under Rule 57AC read with Notification No. 214/86 under which the manufacturer/supplier of the raw material furnished an undertaking to discharge the duty on the finished goods after receipt of the same from the job worker. Therefore, no duty demand could be raised against the appellants specially when there is no evidence on record to prove that the supplier of the raw material had denied the receipt of finished goods after the job work from the appellants. The Counsel has also contended that even otherwise there was no shortage of finished goods as in the RG. I as recorded in the panchnama itself, the balance shown was nil and the same tallied on physical verification. Therefore, the impugned order deserves to be set aside.
3. The learned SR has reiterated the correctness of the impugned order.
4. I have heard both the sides and gone through the record.
5. Admittedly, the appellants, as job worker, received the raw material from the supplier under Notification No. 214/86 read with Rule 57AC. The supplier under the said notification furnished an undertaking to the department that the duty liability in respect of the finished goods received from the appellants after the job work, would be discharged by him. Therefore, the appellants could not be treated as a manufacturer for the purpose of payment of excise duty. The duty liability was of the supplier of the raw material. There is nothing on the record to suggest if the supplier of raw material has denied the receipt of the goods after the job work from the appellants. Therefore, the appellants could not be saddled with the duty demand.
6. Apart from this, there is no tangible evidence to prove the shortage of the finished goods in the factory premises of the appellants. The perusal of the panchnama which was prepared at the spot shows that at the relevant time when the officers visited their factory, the balance recorded in the RG.I register was nil and this balance was not at variance on physical verification. Even if it is taken that the RG.I was maintained by the appellants in respect of their other goods manufactured by them on their own account, still no inference could be drawn that there was shortage of raw material/finished goods when the supplier of the raw material has not accepted the non receipt of the finished goods from the appellants manufactured out of raw material supplied. The ratio of law laid down in the ORG Systems v. CCE Vadodara [1998 (102) E.L.T. 3] referred by the SDR wherein it has been held that job worker is to be treated as manufacturer, is not attracted to the present case as raw material in the present case was received only under the notification detailed above under which the supplier of the raw material had furnished an undertaking to discharge the duty liability.
7. In view of the discussion made above, the impugned order cannot be sustained and the same is set aside. The appeals of both the appellants are allowed with consequential relief as per law.