Custom, Excise & Service Tax Tribunal
M/S. Avtec Ltd vs C.C.E. & S.T. Ltu Delhi on 5 March, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI PRINCIPAL BENCH, COURT NO. II Appeal No. E/58507/2013-EX(SM) [Arising out of Order-in-Appeal No. 33/2013 dated 31.03.2013 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Delhi]. For approval and signature: Honble Shri Ashok Jindal, Member (Judicial) 1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 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? 4 Whether Order is to be circulated to the Departmental authorities? M/s. Avtec Ltd. .Appellants Vs. C.C.E. & S.T. Ltu Delhi .Respondent
Appearance:
Shri Manish Sharma, Advocate for the Appellants Shri R.K. Mishra, DR for the Respondent CORAM:
Hon'ble Shri Ashok Jindal, Member (Judicial) Date of Hearing: 05.03.2015 FINAL ORDER NO. 50578/2015-EX(SM) Per Ashok Jindal:
The appellant is in appeal against the impugned order.
2. The facts of the case are that appellant is manufacturer of IC engine Petrol, IC Engine Diesel, Transmissions and their parts. During the course of manufacture of final product they sent certain processed goods to the job workers for further processing. During the course of processing of job workers certain scrap was generated. The Appellant is receiving processed goods from the job workers but not receiving any scrap. Revenue is of the view that appellant is required to pay duty on the scrap generated at the job workers end. Therefore, demand on duty along with interest were confirmed. Penalty was also imposed. Aggrieved from the said order appellant is before me.
3. The Ld. Counsel for the appellant submits that the issue has came up before this Tribunal in the case of Fag Engineering India Ltd. Vs. C.C.E. Vadodra 2011 (266) ELT 193 (Tri-Amd) wherein this Tribunal held that the demand on duty on scrap generated and sold by the job worker cannot be raised against the principle manufacturer. At the most principle manufacturer may be asked to reverse the Cenvat Credit attributable to the input used in generation of waste and scrap. But in this case department has not asked the appellant to reverse the Cenvat Credit on inputs used in generation of waste and scrap. Therefore, impugned order is to be set aside.
4. On the other hand Ld. AR submits that as per the agreements between the parties the value of waste and scrap forms the part of the job charges. Therefore, appellant is required to pay duty on waste and scrap.
5. Heard the parties. Considered the submissions.
6. The short issue before me to decide whether appellant being principle manufacturer is liable to pay duty on waste and scrap generated at job workers end where job charges forms the part of value of waste and scrap or not. The issue came up before this Tribunal in the case of Fag Engineers India Ltd. (Supra) wherein this Tribunal has held that duty is being demanded by treating them as a manufacturer of waste and scrap which is factually incorrect. In fact, manufacturer of waste and scrap is the job worker. Therefore, duty cannot be demanded from the principle manufacturer. The same view was taken by this Tribunal in the case of Mahindra Hinoday Industries Ltd. Vs. C.C.E. Pune-I-2013 (292) ELT 456 (Tri-Mum) wherein this Tribunal has held in para 7 as under:
7. Therefore, I hold that appellant is not required to pay duty on waste and scrap generated at job workers end. Consequently, impugned order is set aside. Appeal is allowed with consequential relief if any.
(Dictated and pronounced in the open court)
(Ashok Jindal) Member (Judicial)
Bhanu
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E/58507/2013-EX(SM)