Custom, Excise & Service Tax Tribunal
Festo Controls Pvt. Ltd vs Commissioner Of Central Excise, ... on 29 October, 2015
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: E/26192/2013-SM [Arising out of Order-in-Appeal No. 15/2013-CE dated 15/01/2013 passed by Commissioner of Central Excise(Appeal), Bangalore] For approval and signature: HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER 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? 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 Festo Controls Pvt. Ltd. No.237B, Bommasandra Industrial Area, Bangalore 560099. Appellant(s) Versus Commissioner of Central Excise, Bangalore-I Queens Road, Bangalore 560001. Respondent(s)
Appearance:
Shri A.S. Monnappa, Advocate For the Appellant Shri N. Jagadish, Superintendent(AR) For the Respondent Date of Hearing: 26/10/2015 Date of Decision: . CORAM:
HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER Final Order No. / 2015 Per : ARCHANA WADHWA The appellant is engaged in the manufacture of pneumatic systems and parts of didactic equipment and was working under the CENVAT credit scheme. They are getting job work done in respect of certain parts from their other sister unit. As per the appellant, the Unit No.2 was exclusively doing the job work for the appellant.
2. The dispute in the present appeal relates to the CENVAT credit of service tax paid on the construction services availed by Unit No.2. Inasmuch the construction activity was not done in the appellants factory, Revenue entertained a view that the CENVAT credit would not be available to the appellant. Accordingly demand was raised against the appellant by way of a show-cause notice dt. 13/09/2010 for the period July 2008 to July 2010 proposing to deny the CENVAT credit of Rs.1,27,925/-. The said notice culminated into an order passed by the lower authorities confirming the demand along with interest and imposing penalties. Hence the present appeal.
3. It stands contended before me that the unit doing the job work is the appellants own unit located at a different place. It also stands pleaded that the second unit is engaged in the job work of the appellant only and is not doing any other work for other assessees. Learned advocate has also relied upon Tribunals Larger Bench decision in the case of Parry Engg. & Electronics Pvt. Ltd. Vs. CCE&ST, Ahmedabad-I, II, III [2015(40) STR 243 (Tri. LB)] as also the decision of the Tribunal in the case of Expert Industries Pvt. Ltd. Vs. CCE,C&ST, Bangalore-I [2015(39) STR 465 (Tri. Bang.)].
4. Learned AR appearing for the Revenue has submitted that the repair and construction activity was carried out in the second unit, which is not even registered with the Central Excise Department and is not paying any duty on their final product inasmuch as the goods are being manufactured by them on job work basis. As such, availment of credit by the principal manufacturer for the activity done in the job workers factory is not in accordance with law.
5. In my views, the outcome of the case depends on the fact as to whether the job worker is an independent job worker not at all associated with the appellant or the same is a sister unit of the appellant. If the job workers factory is a sister unit of the appellant, as contended by the appellant, it is required to be considered as one manufacturer in which case, the credit of service tax paid in respect of construction activities carried out in the job workers factory would be available to the assessee. However there is no evidence to that effect on the record. As such for consideration of the said factual position, I set aside the impugned order and remand the matter to the original adjudicating authority. The issue of limitation as also imposition of penalty is left open for reconsideration by the adjudicating authority. Appeal is allowed by way of remand.
(Pronounced on ) ARCHANA WADHWA JUDICIAL MEMBER Raja..
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