Custom, Excise & Service Tax Tribunal
M/S. Venus Rubber vs Cce, Coimbatore on 6 November, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
Appeal No. E/1152/2003
(Arising out of Order in Appeal No. 268/2003 CE dated 05.09.2003, passed by the Commissioner of Central Excise, (Appeals), Coimbatore).
For approval and signature
Honble Dr. CHITTARANJAN SATAPATHY, Technical Member
Honble P.K. DAS, Judicial Member
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M/s. Venus Rubber : Appellant
Vs.
CCE, Coimbatore : Respondent
Appearance Shri R. Balagopal, Consultant, for the appellant Shri T.H. Rao, SDR, for the respondent CORAM Dr. CHITTARANJAN SATAPATHY, Technical Member Shri P.K. DAS, Judicial Member Date of hearing : 06.11.2009 Date of decision : 06.11.2009 Final ORDER No._____________ Per: P.K. Das, The relevant facts of the case in brief are that, the appellants were engaged in the manufacture of various rubber products specified under Chapter 40 of the Schedule to the Central Excise Tariff Act, 1985. They were also undertaking job work of rubberizing the rollers supplied by the customers under challans as per Rule 57F (4) of the erstwhile Central Excise Rules, 1944 read with Notification No. 214/86-CE dated 01.03.86. Show Cause Notices dated 19.01.98 and 16.06.98 were issued proposing demand of duty on rubberized rollers returned to the customers after the job work. The original authority dropped the proceedings. The Revenue filed the appeal before the Commissioner (Appeals) whereby the adjudication order was set aside and demands proposed in the show cause notices were confirmed. Hence, the appellants filed this appeal.
2. After hearing both sides and on perusal of the records, we find that the appellants undertook the job work under Notification No.214/86-CE (supra). For the purpose of proper appreciation of the case, the findings of the original authority is reproduced below:-
I have given my earnest consideration to the above arguments and I find that they have considerable force. Neither Rule 57 F(3)/F(4) nor Notification No. 214/86 places any restriction on the use of job workers own raw materials during the process. The denial of the facilities in terms of Rule 57 F(3)/F(4) or not 214/86 is also not contemplated because a major portion of the material used in the process belongs to the job worker. The manufacture of a final/intermediate product by using materials other than or in addition to what is provided by the raw material suppliers is common in the scheme of things. Further, the SCN has also n ot alleged that the raw material supplier has failed to furnish the undertakings or had violated any provisions of the undertaking. The only argument which is advanced is that since the assessee added their own raw materials, and since material wise the major portion belongs to the job worker the exemption has to be denied to them. This proposition does not appear to be in conformity with the provisions of relevant rules. It has, thus to be held, that the demands, raised on the basis of the above proposition in the SCNs are not sustainable and as such the demnds consequently raised in the SCNs are not sustainable. I hold that M/s. Venus Rubbers have been undertaking job work on the raw materials supplied by the customers correctly in terms of Rule 57 F(3)/F(4) and Notification No. 214/86. In the circumstances of the case I pass the following order.
3. The Commissioner (Appeals) set aside the order following the decision of the Honble Supreme Court in the case of Prestige Engineering (India) Ltd. Vs. Collector of C. Excise, Meerut 1994 (73) ELT 497 (SC). We find that the said decision is in the context of Notification No. 119/75-CE. The Commissioner (Appeals) had not disputed the fact that the supplier of raw materials had given an undertaking under Notification No. 214/86-CE to discharge the duty liability on the product manufactured by the job worker namely the appellant herein. On a query from the Bench, the Ld. Consultant on behalf of the appellant confirmed that the supplier of the raw materials paid the duty. It appears that this fact was not disputed in the present proceedings.
4. In view of that, we find that the impugned order of the Commissioner (Appeals) cannot be sustained. Accordingly, the impugned order is set aside. The order of the original authority is restored. The appeal is allowed with consequential relief.
(Operative part of the Order pronounced in the open Court on 06.11.2009)
(P.K. DAS) (Dr. CHITTARANJAN SATAPATHY)
JUDICIAL MEMBER TECHNICAL MEMBER
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