Custom, Excise & Service Tax Tribunal
Ratnamani Metals &Amp; Tubes Ltd vs Ahmedabad-Iii on 17 January, 2019
In The Customs, Excise & Service Tax Appellate Tribunal
West Zonal Bench At Ahmedabad
Appeal No. E/11049-11055/2014-DB
[Arising out of OIO-AHM-CEX-003-COMMR-038-13 Dated 28.11.2013 passed by Commissioner
of Central Excise-AHMEDABAD-III]
[Arising out of OIO-AHM-CEX-003-COMMR-036-13 Dated 26.11.2013 passed by Commissioner
of Central Excise-AHMEDABAD-III]
M/s Ratnamani Metals & Tubes Ltd Appellant
J M Sanghvi
Ashok J Patel
D N Patel
Vs
C.C.E. & S.T., -Ahmedabad-iii Respondent
Represented by:
For Appellant: Shri V.k. Jain Shri Aqeel Sheerazi Ms. Dimple Gohil (Advocate) For Respondent: Shri Deepak Kumar (AR) CORAM:
HON'BLE MR. RAMESH NAIR, MEMBER (JUDICIAL) HON'BLE MR. RAJU, MEMBER (TECHNICAL) Date of Hearing: 18.09.2018 Date of Decision: 17.01.2019 Final Order No. A / 10108-10114 /2019 Per: Ramesh Nair The present appeals have been filed by against Order-in- Original No. AHM - CEX-003-COMMR-036-13 dated 26.11.2013 and Order-in-Original No. AHM-CEX-003-commr-038-13 dated 28.11.2013 both passed by the Commissioner of Central Excise, Ahmedabad - III. The following demands and penalties were confirmed in terms of the aforesaid Orders against the units of the Appellant:
Order-in-Original No. AHM-CEX-003-COMMR-036-13 dated 26.11.2013:
Cenvat Credit Duty demand Penalty
disallowed
Indrad/Mehsana 4,87,57,974/- 24,70,884/- 5,12,28,858/-
SSTP Plant
Chhatral SP 2,45,10,572 NA 2,45,10,572/-
Dehgam NA 1,03,52,230/- 1,03,52,230/-
Shri J M Singhvi 2,15,22,915/-
Shri D.N. Patel 61,27,643/-
2|Page E/11049-11055/2014-DB
Shri Ashok 1,28,07,215/-
Patel
Order-in-Original No. AHM-CEX-003-commr-038-13 dated 28.11.2013:
Cenvat Duty Penalty
Credit demand
disallowed
Indrad/Mehsana NA NA 26,40,000/-
SSTP Plant
Chhatral SP NA NA 33,34,000/-
Jamnagar NA 5,79,34,667/- 5,79,34,667/-
Kutch 6,71,230/- 2,32,22,735/- 2,38,93,965/-
Dehgam NA NA 25,89,000/-
Shri J M Singhvi 2,05,50,000/-
Shri D.N. Patel 33,34,000/-
2. The brief facts of the case are that Appellant M/s Ratnamani Metals & Tubes Ltd are engaged in manufacture of MS/ CS Saw Pipes, Spiral SAW Pipes etc. and SS Seamless/Welded Pipes & Tubes falling under chapter 73 of the CETA, 1985. They are having central excise registered manufacturing facilities as under:
1. Chattral - Saw Pipes (SP) Divison
2. Inrad/ Mehsana - Stainless Steel Tubes & Pipe (SSTP) Division
3. Bhimasar, Kutch - All types of Pipes and Gunniting
4. Jamnagar Mobile Plant - M.S. Bare Pipe and gunniting
5. Dehgam Mobile Plant - M.S Bare Pipes During the impugned period the aforesaid divisions undertook manufacturing activities of Pipes which were numbered by them as Work Order No. 465 (Lot 8 and Lot 5), Work Order No. EXP - 210, Work Order No. EXP - 216, Work Order No. EXP - 207, Work Order No. EXP - 246, Work Order No. 7156, Work Order No. 9246, Work Order No. 454, Work Order No. 456 and Work Order No. 468. However looking to operational and technical necessities the above work orders were got completed by one division from other Division as job work. The revenue objected to the same and after investigation two show cause notices, demanding cenvat from the principal manufacturer and duty from job worker, were issued to aforesaid divisions.
3. The first Show Cause Notice No. V.73/15-256/Dem/OA/2010 dated 29.04.2010 was issued alleging that SSTP and SP Division has wrongly availed cenvat credit of raw material by showing the
3|Page E/11049-11055/2014-DB manufacture of final product on job work basis whereas the process adopted by them cannot be considered as job work. Also demand of duty was made from the Division who undertook job work activity. In case of job work activity undertaken by the Kutch Division, it was alleged that they have misused the benefit of Notification No. 39/2001 dated 03.07.2001 as the goods manufactured at Saw Pipe Division, Chhatral and Stainless Tubes & Pipe Division, Indrad have been cleared for home consumption on the basis of invoice of Kutch Divison; that goods manufactured at Kutch Division were exported by showing them as having been manufactured by SSTP or SP Division and they were misusing the provisions of job work to legitimize these transactions. It was alleged that the goods manufactured by the Appellant were customer specific goods. The Appellant has allotted unique number to purchase orders received from customer which was termed as "Work Order" (WO) and separate records were maintained for each WO. The goods of these said work orders were not manufactured/ cleared from respective division or material receipt memos did not tally with the consignee factory, indent no. & W.O No. It was alleged that in case of Work order No. 465 (Lot 8) and (Lot 5) the Work Order was allotted to mobile Jamnagar Plant and the clearance of goods was exempted from duty in terms of Notification No. 108/95 - CE dated 28.08.1995. The pipes were manufactured by Jamnagar Division on Job work basis for and cleared by Jamnagar Mobile Plant to GWSSB. The said plant was established temporarily to execute three purchase orders of GWSSB regarding supply of Gunnetted pipes under Asian Development Project.
Since the final products were exempted from payment of duty under Notification No. 108/95 - CE dated 28.08.1995, they made an application before the Assistant Commissioner for procurement of raw material without payment of duty which was rejected. Since the Jamnagar Unit was not in a position to utilize the credit of raw materials, the Indrad SSTP Division and Chhatral SP Division were allotted the work orders and the said two divisions made application to the jurisdictional Commissioner to clear gunetted pipes from Jamnagar Mobile Plant to GWSSB without disclosing that earlier they had informed to AC, Jamangar having jurisdiction over Jamnagar Plant for procurement of goods without payment of duty and to fit into the scheme, the movement of raw material was shown from these two divisions to Jamnagar Mobile Plant, even if the raw material had not
4|Page E/11049-11055/2014-DB been received by them and was directly consigned to Jamnagar Mobile Plant. The finished goods were also dispatched to GWSSB directly from Jamnagar Mobile Unit, but the dispatch was shown under the invoice of SSTP Division and SP Division. That no undertaking under Notification No. 214/86 -CE dated 25.03.1986 was filed with the said division before jurisdictional authorities and therefore the Jamnagar Mobile Plant cannot be considered as job worker. Even the permission given by the Commissioner was subject to fulfilment of condition of Trade Notice No.36/2003 that the original and duplicate copies of challan shall accompany the inputs or partially processed an input which was not followed. The Jamnagar Mobile Plant has not worked as Job worker but independent manufacturer. It was also contended that the Appellant has shown gunneting of pipes by Shriji Constructions whereas the place at which the unit was shown is a government land and therefore the credit availed by SP Division on wire mesh and cement is also not available. Therefore in case of work Order No. 465/8 cenvat of Rs. 3,98,52,681/-; in case of Work Order No. 468 cenvat of Rs. 80,61,828/- and in case of Export Work Order No. 216 and No. 246 cenvat of Rs. 843465/- Totalling Rs. 4,87,57,794/- was proposed to be disallowed to SSTP Division. Further Central Excise duty of Rs. 24,70,884/- was demanded on the ground that the goods pertaining to Work Order No. 7156 and 9246 were manufactured at SSTP Division showing them as job work but were cleared without payment of duty under Notification No. 39/2001 - CE from Kutch Division and hence SSTP Division being actual manufacturer is liable to pay said amount of duty. A demand of Cenvat of Rs. 2,45,10,572/- was made against SP Division in case of Work Order No. 465 (Lot 5) and Work order No. 456 and 454 was proposed against Stainless Pipe Division on the ground that the goods were manufactured by other divisions showing them as job worker whereas the credit has been availed by Stainless Pipe (SP) Division. A central Excise duty of Rs. 1,03,52,230/- was demanded from Dehgam mobile plant on the ground that the activity undertaken by them on account of SP Division cannot be considered as Job wok and they being manufacturer are liable for duty. It was also proposed to confiscate the raw material on which cenvat credit has been availed and the finished goods on which duty has been demanded; to demand interest on cenvat and duty demand. Further penalty was also proposed under Rule 25 and Section 11AC. It was also proposed to impose penalty upon Director
5|Page E/11049-11055/2014-DB Shri J.M.Singhvi, GM (Operations) Shri D.N. Patel and Deputy Manager Shri Ashok Patel. The adjudicating authority confirmed the demands as proposed and also imposed penalty as stated in foregoing Para.
4. One more Show Cause Notice No. V.73/AR-Gnd/Commr/115/2010 dated 28.04.2010 came to be issued to the aforesaid divisions proposing demand of cenvat of Rs. 6,71,230/- against Kutch Division on the ground that the credit has been wrongly taken as the raw material was used at SP division and Kutch Division did not undertake any activity. Central Excise duty of Rs. 2,32,22,735/- was demanded from Kutch Division on the ground that the goods covered by Work Order No. 465 Lot 5 was manufactured by Kutch Division but the same were cleared under invoices of SP Division. Further that Export goods covered under Work Order No. 210,216 and 207 were though manufactured by Kutch Division but were cleared on invoices of SSTP Division; Central Excise duty of Rs. 5,79,34,667/- was demanded from Kutch division on the ground that the pipes covered under Work Order no. 465 (Lot 8) were manufactured by Jamnagar mobile Plant but were cleared under the cover of invoice of SSTP Division Or SP Division. It was also proposed to confiscate the raw material used in finished goods on the ground that the wrong credit has been availed by Kutch Division. Similarly the finished goods were proposed to be confiscated on the ground of having been cleared without payment of duty. It was also proposed to impose penalty under rule 25 and section 11AC upon Kutch and Jamnagar Mobile Plant. Penalty under rule 26 was also proposed on SP Division, SSTP Division and Dehgam mobile Plant and Kutch Division. Penalty under Rule 26 was proposed upon Shri J.M. Singhvi, director of M/s RTML and D.N Patel, G.M. (Operations), SP division. The demands and penalties were confirmed by the adjudicating authorities vide the impugned orders. Being aggrieved, the Appellants have filed present appeals against both the Orders.
5. Shri V. K. Jain Ld. Counsel appearing for the Appellants submits that the impugned order has demanded cenvat credit from three units viz. SSTP Division Indrad, SP Division Chhatral and Kutch Division and central excise duty from Jamnagar Mobile Plant, Kutch Division, Dehgam Mobile Plant and SP Division Indrad. He submits that mainly the demand of duty and disallowance of Cenvat credit pertains to Work Order No.
6|Page E/11049-11055/2014-DB 465 (Lot 5) and 465 (Lot 8) which were issued by Gujarat Water Supply and Severage Board (GWSSB). The other demand of cenvat and duty pertains to remaining work orders. In respect of Work Order No. No. 465 (Lot 5 ) and 465 (Lot 8) issued by GWSSB he submits that the pipes were supplied by either Chhatral or Indrad Unit who in turn engaged other units of Appellant locates at kutch, Jamnagar and Dehgam as well as outside job workers. The job work was carried out in terms of rule 4 (5) (a) of the Cenvat Credit rules, 2004 or in terms of specific permission granted to Chhatral and Indrad Units under Rule 4 (6) of Cenvat credit Rules which permits those units to pay duty on the finished goods cleared directly from the premises of Job worker's premises even when such inputs were received directly by the job worker. The applications made for obtaining such permission clearly mentioned the procedure adopted by them. They had also stated that the goods manufactured from job worker shall also be sent to another job worker M/s Shreeji Construction kalawad wherefrom the final products would be supplied directly to GWSSB against invoice to be issued by Chhatral and Indrad Units. It was also informed the manners in which Job work challans would be raised by Indrad and Chhatral Units as well as the point in time by the said two units on the basis of challans, the manner of accounting of finished goods in Daily Stock account. That the Assistant Commissioner (Technical) initially objected to this procedure on the ground that the entire processing will be done by the another unit of the company since the units at Chhatral was neither receiving raw material nor the finished goods. That in response to same they furnished all the information as required under trade Notice No. 36/2003 and the permission was granted to them on 27.05.2005 for Chhatral unit and on 20.05.2005 for Indrad unit. In accordance with these permissions, the job work was got done. He submits that in case of job work of Chhatral Unit in relation to Work order No. 465 (Lot 5) from Kutch and Dehgam Units, the pipes manufactured by them on jobwork basis were received back by them and were cleared for gunniting to another job worker namely Shreeji Constructions, Kalawadas as per the specific permission granted to them under Rule 4 (6) of CCR. He also submits that the department has relied upon the statement of Partner of Minaxi handling Service and some employees to the effect that the pipes manufactured at Kutch Division on job work were not returned to Chhatral unit is incorrect assertion as
7|Page E/11049-11055/2014-DB it did not concern these movements. The statements of employees of the company about LR being issued without movement of the goods does not relate to transaction of job work between Chhatral-Kutch - Shreeji construction or Chhatral-Dehgam-Shreeji constructions. The statement of partner of Minaxi Handling Service, Shri Pramod Bansal is related to gunnited pipes and involved movement between Chhatral and Kutch (without involvement of Shriji Construction) where gunnited pipes were manufactured. That even the statements are not reliable as inspite of request for cross examination he was never offered for cross examination and therefore his statement is not reliable. That even in situations where the finished goods were cleared to customer directly from the premises, the adjudicating authority should not have demanding duty and disallowing credit when he himself granted the permission. The Ld. Commissioner ought to have considered that the goods in question were cleared under Notification No. 108/95 - CE dated 28.08.95 or were being exported both of which warranted special treatment in the light of Rule 6 (6) of CCR which specifically provides that Cenvat Credit is available even if the finished goods are cleared under exemption or without payment of duty. He submits that the adjudicating authority has denied the exemption under Notification No. 108/95 - CE on the ground that the certificates did not refer to job worker unit which had manufactured the goods or even if they did, they were not produced before the concerned central excise officer of that unit before clearance of goods from the factory. The said contention is not correct as there is no dispute about clearance of goods to GWSSB and there is no stipulation that exemption is available only if the certificate are issued to the unit where the actual manufacturing has been conducted. That the exemption notification has to be construed liberally. He relies upon the judgments in case of Sterlite Technologies Ltd. Vs. CCE & CUS, Vapi 2009 (240) ELT 415 (TRI), HY-TUF Steels Pvt. Ltd. Vs. CCE, Vadodara 2015 (327) ELT 531 (TRI), CCE, Pondicherry Vs. Catterpillar India Pvt. Ltd. 2013 (297) ELT 8 (Mad.) as affirmed by the Apex Court reported in 2016 (335) ELT A27 (SC) and CCE, Alwar Vs. Kamdhenu Ispat Ltd. 2017 (348) ELT 64 (RAJ) which holds that the benefit of exemption has to be allowed even if the certificates are issued after clearance from factory. He submits that the certificates were filed with the jurisdictional excise authority of Indrad and Chhatral who got
8|Page E/11049-11055/2014-DB the job work done and the same is compliance of the exemption notification.
6. As regard other supplies other than GWSSB, he submits that such supplies were of two types viz. Pipes that were exported and Pipes manufactured for domestic sale. In case of Pipes manufactured for exports under Work Order No. EXP-207, EXP-201, EXP - 216 and EXP 246, he submits that in case of EXP-207 and EXP 210 the raw material were imported under Advance licence and no cenvat credit was availed, In case of Exp-216 and EXP- 246, the credit of Rs. 5,56,372/- and Rs. 2,87,093/- was availed by Indrad unit and the goods were manufactured by Kutch Unit on job work. The adjudicating authority has denied cenvat to M/s Indrad Unit and has demanded duty of Rs. 98,88,639/-. The demand has been confirmed on the ground that entire manufacturing process was carried out at Kutch Division which is job worker. He submits that the jobwork process was carried out under Rule 4 (5) (a) which permits a job worker to carry out all operations relating to manufacture of goods. He relies upon the definition of Job work and judgments rendered in this context Aries Dyechem Industries Vs. CCE, Ahmedabad 201 (257) ELT 113 (TR) as affirmed by Gujarat High Court reported in Commissioner Vs. Aries Dyechem Industries 2014 (299) ELT A88 (Guj.), Amul Industries Pvt. Ltd Vs. CCE, Rajkot 2006 (206) ELT 1043 maintained by Gujarat High Court as reported in 2013 (290) ELT A55 (Guj.) and Bata India Ltd. Vs. CCE, Banglore - II 2006 (199) ELT 847 that a job worker can conduct the entire manufacturing operation under Rule 4 (5) (a). He submits that there is no dispute about pipes having been exported and thus there is no question of demand of duty. That at the relevant point of time the Kutch Unit was eligible to avail rebate of duty paid on export goods cleared for export under Rule 18.
7. In respect of Pipes manufactured for domestic sale, he submits that the demand of Duty of Rs. 22,50,863/- against SSTP Division, Indrad on the ground that the goods were manufactured on job work at Indrad just to show the Kutch Plant as principal manufacturer thereby claimed benefit of duty refund under Notification No. 39/2001 - CE dated 31.07.2001. He submits that the contention of the adjudicating authority is incorrect as the duty was already paid by Kutch Plant which
9|Page E/11049-11055/2014-DB has not been disputed and duty on same goods cannot be demanded twice. The SSTP plant is only a job worker and the goods were returned to Kutch Division being the principal manufacturer. A credit of Rs. 5,05,275/- on raw material has been denied to Kutch Plant as the manufacturing took place at SSTP Division, Indrad on the ground that the Kutch Plant can avail the refund of duty as per Notification No. 39/2001 - CE dt. 31.07.2001. He submits that since the Kutch Plant is Principal manufacturer, hence rightly availed the credit.
8. A credit of Rs. 7,55,573/- to Chhatral Unit pertaining to Work Order No. 454 and of Rs. 80,61,828/- to Indrad Unit pertaining to Work order No. 468 has been denied on the ground that they have availed credit in violation of Rules 6 (1) and 6 (2) of Cenvat Credit Rules. The Ld. Counsel submits that they could maintain separate record only of input HR Plate and for other input and input services, they could not maintain the separate record, hence an amount equal to 10% of value has been rightly reversed as per Rule 6 of CCR. In respect of Chhatral unit a credit of Rs. 28,92,922/- pertaining to Work Order No. 456 has been denied on the ground that the raw material was delivered at Kutch plant and the Pipes were also manufactured there, hence the credit availed by Chhatral Unit and since no activity was undertaken by them, the credit is not admissible. He submits that the inputs initially were wrongly sent to Kutch Plant by Essar Steel, however were subsequently delivered at Chhatral and the invoices were rectified. The Kutch Plant started doing Commercial production only in 2005 and there is no manipulation of record and therefore there is no reason to deny the credit.
9. He submits that the adjudicating authority has demanded full duty on goods supplied to GWSSB as well as denying credit to the inputs used in the goods involved which is contrary to the object of the Notification No. 108/95 - CE dated 28.08.1995. He submits that both the mobile plants at Dehgam and Jamnagar were extension of the main plants of Chhatral and Indrad and it is an undisputed fact that both mobile plants were set up only to cater requirement of pipes to be supplied to GWSSB. Therefore all the plants of the Appellant ought to be considered as one unit. He relies upon on Apex Court judgment in case of M/s Vikram Cement Vs. Commissioner 2006 (194) ELT 3 (SC). He 10 | P a g e E/11049-11055/2014-DB further submits that the demands are barred by limitation as the full disclosures of facts were made in the applications filed by the Appellants under Rule 4 (6) of CCR, 2004. The correctness of the documents on the records has not been questioned except to the extent of some transactions relating to Chhatral unit and the Kutch Unit where gunnited pipes are claimed to have been directly cleared to GWSSB without bringing them back to Chhatral. The situation is revenue neutral in as much as if the cenvat credit is not available to one unit then it is available to other unit which is allegedly a manufacturer.
10. Shri Deepak Kumar, Special Counsel appearing for the revenue submits that in case of supplies to GWSSB the SSTP Division and SP Division have cleared goods directly from the job worker premises. The application filed by them towards clearance directly from the premises of job worker had no mention that the inputs will be directly sent to the job worker without being brought to the premises of SP and SSTP Division. Query was also raised that the receipt of raw material directly from supplier at the premises of job worker and clearance of finished goods directly to customer from job worker premises while taking credit at Mehsana Unit appear to be paper transaction. The permissions for removal of final product directly from the premises of the job worker in terms of Rule 4 (6) of the CCR, 2004 were given on 27.05.2005 and 20.05.2005 for clearing the goods from the premises of job worker Jamnagar mobile Plant subject to fulfilment of condition of the Trade Notice 36/2003 dt. 27.03.2003. The Condition of the Trade Notice prescribes the procedure to be followed for removal of inputs from the principal manufacturer to the job worker which clearly shows that the permission was granted only in respect of those inputs which were first received by the principal manufacturer and then sent to Job worker. The Appellant's application in terms of trade notice cannot be considered as continuation of their letter dt. 29.04.2005 and the condition of the Trade Notice was not relaxed. Further SP Division vide their letter dated 04.08.2005 addressed to Assistant Commissioner had sought permission under rule 4 (6) for removal of their final product namely gunnited pipes from job worker premises i.e. M/s Shreeji Construction. That if the department would have known that the inputs shall be sent directly from supplier to job worker, they would not have given permission under rule 4 (6). Therefore the demand of duty from job worker and disallowance 11 | P a g e E/11049-11055/2014-DB of cenvat credit to the so called principal manufacturer namely SP & SSTP Division is not in contradiction to the permission granted under rule 4 (6). In their application filed under rule 4 (6) there was no mention that the inputs shall be directly sent to the job worker. The SP and SSTP Division thus cannot be called as manufacturer. He relies upon CESTAT Order in case of M/s Safelex International Ltd 2014 (302) ELT 65 (TRI). He submits that SP Division and SSTP Division are not entitled for the credit as in terms of Rule 4 (5) (a) the inputs, semi finished goods or the finished goods were not received within 180 days. In respect of duty demand on goods cleared to GWSSB he submits that since the certificates under 108/95- CE did not have their name appearing in the certificates therefore the demand is sustainable. He relies upon the judgment in case of DEE Development Engineers Ltd. 2010 9254) ELT 412 (P & H). The job worker is not exempted from payment of duty because the said rule 4 (5) of CCR is facility to the principal manufacturer to send the inputs on which cenvat credit has been availed and nothing to do with payment of duty as held in case M/s pf Thermax babcock and Wilcox Ltd. Vs. CCE, Pune - I 2017 (12) TMI 266 -CESTAT. The procedure under Notification No. 214/86 - CE were not followed and hence duty is payable. The Jamnagar Mobile Plant and Kutch has not submitted certificate under the 108/95 - CE and hence the exemption is not available.
11. As regard duty demand in other case except supplies to GWSSB, he submits that in case of Work order No. EXP 207 even though the pipes were exported, it would not mean that the duty would not be payable by Kutch division as the procedure under Notification No. 214/86 -CE was not followed by SSTP Division. In reference to Work Order Export 210 he submits that out of 5321 pipes manufactured by Kutch Division, the 5183 pipes were exported by SSTP Division and hence duty of Rs. 1.31 lakhs is payable on remaining pipes. That in case of 5183 pipes the goods were not exported by Kutch Division, hence duty is payable. In respect of Work Order No. 7156 & 9246 related to SSTP division, he submits that work order no. 7156 was assigned to Kutch Division for supply to Godrej & Boyce. 58.045 mts pipes were imported on account of Kutch Division from China under advance licence but 3069 pipes were manufactured at SSTP Division and sent to Kutch Division for clearance to customer Similarly in work order no. 9246 the 12 | P a g e E/11049-11055/2014-DB work order was allotted to Kutch division for supply to Doshion & Co. The coils were purchased on account of Kutch division and dispatched directly to SSTP Division for slitting. The STP division manufactured 28 SS Welded pipes and returned the remaining coils after cutting to Kutch division and hence it is admitted fact that SSTP manufactured 28 pipes. In such situation SSTP Division was liable to pay duty. The fact that duty has been paid by Kutch division is not relevant as the SSTP Division could not have sent pipes to Kutch without payment of duty. Further at relevant point of time whatever duty would have been paid by Kutch Division would have refunded to them Under Notf. No. 39/2001. As regard demand of cenvat of Rs. 6,71,230/- on same work order No. 9246 from Kutch division he submits that since the Kutch Division have not received the said quantity but the goods were sent directly to SSTP Division, hence cenvat credit of Rs. 1,65,955/- is not available to Kutch. In case of Work Order No. 454 and Work order No. 468 where the credit of Rs. 7,55,570/- and Rs. 80,61,828/- has been denied to SP and SSTP Division respectively he submits that the credit is not admissible as they had maintained separate account of the final product cleared under Nil Rate of duty and hence the 10% reversal under Rule 6 of CCR is not applicable. In case of Work Order No. 456 related to SP Division wherein cenvat of Rs. 28,92,922/- has been denied, he submits that the raw material was delivered at Kutch Division and therefore the credit is not available to Kutch Division.
12. In reference to demand of duty of Rs. 5,16,47,075/- from Jamnagar Mobile Plant in reference to work Order No. 465 (Lot 8) which were cleared under invoice of SSTP Division he submits that SSTP division did not claim benefit of Notification No. 214/86 -CE, hence Jamnagar Mobile Plant is liable for duty. He relies upon Tribunal order in case of Federal Mogul Goetze India Ltd. 2015 (318) ELT 340 (TRI) and International Engg. & Mfg. Serv. P. Ltd. 2001 (135) ELT 551 (TRI) as upheld by Apex Court in 2002 (139) ELT A88. In respect of demand of duty of Rs. 62,87,591/- from Jamnagar Mobile Plant which were cleared under invoice of SP Division he submits that since the Jamnagar plant did not produce any certificate of exemption under Notf. No. 108/95- CE hence liable for duty. For both the above demands he relies upon the judgment in case of HariChand Gopal 2010 (260) ELT 3 (SC) and Sterlite Indus. (I) Ltd. 2005 (189) ELT 266 (AP). As regard demand of 13 | P a g e E/11049-11055/2014-DB cenvat credit of Rs. 3,98,52,681/- from SSTP Plant and Rs. 48, 83,919/- from SP division for which the raw material was directly cleared to job worker M/s Jamnagar Mobile Plant and which was cleared from Jamnagar Mobile Plant directly to GWSSB, he submits that since the inputs or the intermediate goods or the final products were not returned to them in terms of Rule 4 (5) (a) of CCR, the credit is not available.
13. In reference to demand duty of Rs. 1,33,36,095/- pertaining to Work order No 465 (Lot 5) from Kutch division for the period on which credit was availed by SP Division, Chhatral and the goods were cleared under the invoice of SP Division to GWSSB he submits that as the SP division did not follow the procedure under rule 4 (5) (a), The SP Division did not take permission for clearance of goods from Kutch division nor the SP Division carried out any manufacturing process on these goods. Also that the name of Kutch Division is not appearing on certificate issued under Notification No. 108/95 - CE, hence the duty is to be paid by Kutch Division. Moreover if the exemption is available it shall not be available to gunneted pipes and not bare pipes which were cleared by Kutch division for gunneting.
14. In respect of denial of cenvat credit of Rs. 89,47,290/- availed by SP Division and for which the material was directly sent to Kutch Division pertaining to work Order No. 465 (Lot 5), he submits that HR Plate and Wire & flux were sent directly from suppliers. Thereafter the bare and gunnited pipes were sent to Jamnagar Mobile Plant for gunniting or to ultimate buyer M/s GWSSB by showing the transportation through GWSSB. He submits that since the Rule 4 (5) (a) was not followed and the inputs, Semi finished goods and final products were not received by SP Division, hence credit is not available.
15. As regard demand of duty of Rs. 1,03,52,230/- form Dehgam Mobile Plant he submits that since the jobwork procedure was not adopted by the SP Division the jobworker i.e the Dehgam Mobile Plant is liable for duty to goods cleared to GWSSB. He submits that similarly cenvat creit of Rs. 70,30,870/- availed by SP Division on raw materials directly cleared to Dehgam Mobile Plant is not available to them since the procedure under Notf. No. 214/86 -CE was not followed by them. 14 | P a g e E/11049-11055/2014-DB
16. In respect of Pipes manufactured for Exports and domestic supplies other than Clearances made under Notf. No. 108/95, the Ld. Special Counsel for the revenue submits as under:
"As regard pipes manufactured for purpose of Export under Work order No. EXP-207 and which were cleared for export by SSTP Division the duty of Rs. 29,33,719/- stands demanded from Kutch Division. He submits that the manufacturing took place at Kutch Division and therefore the duty is to be paid by them. Further he submits that for the same reason duty of Rs. 47,68,608/- is to be paid by Kutch Division in respect of Work Order No. EXP -210 in which the export goods were exported under invoice of SSTP Division. In respect of 138 pipes valued at Rs. 8,05,673/- under export order no. 210 which were sent to SSTP Division but were not exported, he submits that the duty of Rs. 1,31,486/- is payable. In case of Work Order No. EXP -216 wherein the goods were exported by SSTP Division, he submits that since the goods were manufactured by Kutch Division, the duty is to be paid by them. He submits that in all the above exports, even the pipes were packed in sea worthy packing by Kutch Division. That the employees of SSTP Division have also accepted that entire manufacturing process was done at Kutch division. In respect of demand of Cenvat of Rs. 8,43,465/- from SSTP Division pertaining to Work Order No. EXP - 216 and EXP- 246 goods manufactured under which were exported, he submits that the goods were manufactured and packed in sea worthy packing. The Appellant has accepted that the goods were received fully manufactured at SSTP Division. Since the goods were manufactured at Kutch Division, credit is not available."
17. Heard both the sides and perused the appeal papers and written submissions filed by both the sides. We find that the Appellant concern had five manufacturing locations at different places in the State of Gujarat. Whereas the three Plants located at Chhatral (Stainless Pipe Division or SP Division), Indrad Stainless Steel Tubes & Pipes Division (STP Division) and Kutch Division were fixed Plant the plants located at Jamnagar and Dehgam were mobile Plants. Further it is also a fact that the Appellant received the orders and it was there marketing department which was providing the code to each order and was allotting the order to the respective plant. In the backdrop of the above facts, the Appellant received various orders for clearing of goods for Gujarat Water Supply and Sewerage Board (GWSSB), Export Orders and few domestic supply order. The GWSSB Order was in respect to supply pipes to the project financed by the Asian Development Board and thus the goods were to be supplied without payment of duty in terms of Exemption Notification No. 108/95 - CE dated 28.08.1995. The Appellant to such supply contract had allotted work Order No. 465 (Lot5), 465 (Lot 8). The duty on such supplies has been demanded from 15 | P a g e E/11049-11055/2014-DB Jamnagar Mobile Plant of Rs. 5,16,47,075/- cleared under invoice of SSTP Division and Rs. 62,87,591/- on pipes cleared under invoice of SP Division. Further the credit availed by SSTP Division of Rs. 3,98,52,681/- and credit of Rs. 48,83,919/- by SP Division on raw materials used in manufacture of finished goods cleared to GWSSB has been denied. A demand of Rs. 1,33,36,095/- against Kutch Division on similar nature of supplies made to GWSSB under Notf. No. 108/95 - CE dated 28.08.1995 has been made. Also credit of Rs. 89,47,290/- availed by SP Division on inputs used in manufacture of such finished has been denied. Similarly a demand of Rs. 1,03,52,230/- from Dehgam Plant has been made on the goods which was cleared by them under invoices of SP Division to GWSSB. The reason to make duty demand is mainly that the raw material was directly sent from the manufacturer to the factory of the job worker and after manufacture of goods the same without being brought back to the factory of the Principal manufacturer was cleared directly to GWSSB. It has been contended by the revenue that the Principal manufacturer did not follow the job work provisions under Notification no. 214/86 - CE and hence the job worker M/s Jamnagar Mobile Plant being manufacturer is liable for duty. For the same reason that the Principal manufacturer did not bring either the raw material or intermediate goods or the finished goods to their factory and the clearance of finished goods did not take place from their factory, the cenvat credit has been denied to them. We find that the Jamnagar Mobile Plant and Dehgam mobile Plant were the facility only to cater the requirement of completion of pipe supply to GWSSB under exemption notification and was temporary extension of manufacturing facility of main plants i.e. SSTP/ SP OR Kutch Division as the case may be. It is also a fact that the Appellant's had disclosed their procedure of manufacture of goods by Jamnagar Plant by direct receipt of goods from supplier and clearance of finished goods therefrom to the GWSSB or the job worker Shreeji Construction for gunniting and then to GWSSB. Further they had also sought permission for clearance of goods directly from the premises of the job worker which was granted to the SSTP and SP Division. We find from the letter dated 05.05.2005 of the appellant that they have stated all the facts of job work right from the setting up the Jamnagar Mobile Plant upto discharge of duty by SP and SSTP Division. The revenue has alleged that even though they had permitted the clearance of the finished goods directly from the job worker but their 16 | P a g e E/11049-11055/2014-DB objection to direct receipt of raw material at job worker premises i.e. Jamnagar mobile Plant and the clearance of the finished goods directly to customer is only paper transaction. We are of the view that the principal manufacturer as well as the job worker both are merely Division of RTML. It is only a case where one division allotted the work to another. The contention of the revenue that it seemed to be paper transaction would have been correct, if no manufacturing activity would have been taken place at the job worker's end or one party out of the principal manufacturer or job worker would have been for the namesake without any existence of factory or there would have been no manufacture of goods. However in the present case both the Principal manufacturer and the job worker owned complete manufacturing set up. It is also not disputed that the raw material on account of principal manufacturer reached to the job worker and was used for the manufacture of final product on their account. The demand of cenvat on the one hand from the principal manufacturer on raw material which reached to the job worker and demand of duty from the job worker on the finished goods manufactured from such raw material itself proves that the raw material was used for the intended purpose only. Thus in such case the cenvat credit to the principal manufacturer i.e SP and SSTP Division cannot be denied. We also find that one of the reason for demanding duty from the job worker unit is that the certificates issued under Notification No. 108/95 - CE dated 28.08.1995 did not contain its name. In this context we find that it is not disputed that the job workers had manufactured finished goods on job work basis on behalf of principal who has cleared the goods to the intended recipient. In such case we do not find any reason to demand duty from the job worker. Moreover it is also a fact that the goods were eligible for the exemption. It has been held by the Tribunal that the exemption is available even if the job worker name is not stated in the certificate as the fact of clearance is not disputed. We find that the Hon'ble Rajasthan High Court in case of COMMISSIONER OF CENTRAL EXCISE, ALWAR Vs. KAMDHENU ISPAT LTD. 2017 (348) E.L.T. 64 (Raj.) while dealing with the similar issue dropped the demand holding as under:
7. We have heard learned counsel for both the parties.
8. Taking into account the reasoning adopted by the Commissioner (Appeals), particularly, at Page 46 wherein it has
17 | P a g e E/11049-11055/2014-DB relied various decisions of Supreme Court which reads as under
:
(b) In the case of Commissioner of Customs, Kolkata v. Rupa and Co. Ltd. reported in 2004 (170) E.L.T. 129 (S.C.) Hon‟ble Apex Court has observed that "An exemption notification has to be constrained strictly but that does not mean that the object and purpose of the notification is to be lost sight of and the wording used therein ignored. Where wording of the notification are clear and unambiguous they have to be given effect to.
Exemption cannot be denied by giving a construction not justified by wordings of the notification."
(c) In the case of Commissioner of Central Excise, Trichy v. Rukmani Pakkwell Traders reported in 2004 (165) E.L.T. 481 (S.C.) Hon‟ble Apex Court has observed that "It is settled law that exemption notification have to be strictly construed. They must be interpreted on their own wordings. Wordings of some other notification are of no benefit in construing a particular notification."
(d) In the case of I.T.C. Ltd. v. Commissioner of Central Excise, New Delhi reported in 2004 (171) E.L.T. 433 Hon‟ble Apex Court has observed that „If the statutory language is unambiguous then that must be given effect to. The legislature is deemed to intend and mean what it says. The need for interpretation arises only when the words used in the statute are on their own terms ambivalent and do not manifest that intention of the legislature."
(g) In the case of Johnson & Johnson Ltd. v. CCE, Aurangabad reported in 1997 (92) E.L.T. 23 (S.C.) Hon‟ble Apex Court, has held that "Interpretation of taxing statute - Exemption - In interpreting an earlier notification, when the question is whether a narrow view or a broader view would be more appropriate, intention of the authorities could be gathered from the subsequent notification - Section 5A(1) of Central Excise Act, 1944. We are of the opinion that the intention of the authorities was to grant exemption to certain life saving and sight saving articles manufactured in the country and once this intention is clear from the subsequent notifications issued under Section 5A of the Act in 1995, we do not see any reason why we should take a narrow view to confine the two items produced by the appellants to Entry 3005.90 rather than place them in the wider connotation of surgical appliances in Entry 90.18 of Chapter 90."
9. The Commissioner (Appeals) has observed as under :
"10. In view of above discussion, I observe that in the said notification there is no specific requirement that the certificate issued by the competent authority should be issued in the name of the appellant/assessee. The act of importing additional condition, which is not mentioned in the notification, by way of interpreting the notification is not tenable. I also find that the Adjudicating Authority has erred in importing additional conditions which were not present in the notification.
11. I also find that, the appellant has submitted a certificate from executive head of the Project Implementing Authority and countersigned by Principal Secretary or the Secretary (Finance) in the concerned State Govt., that the said goods are required for the execution of the said project. This is not a case where 18 | P a g e E/11049-11055/2014-DB the goods have not been supplied to the specified project or diverted. There is no allegation on the appellant about non- supply of the goods for the specified project. Thus, I find that, the appellant has submitted a clarification later on by their letter dated 2-5-2005, and they supplied the goods to the specified projects, which has not been denied, therefore, the benefit of Notification No. 108/95-C.E., dated 28-8-1995 is admissible."
10. The Tribunal, has in Para 5, has observed as under :
"5. We have considered the submissions from both the sides and perused the records. The respondent had supplied mild steel CTD bars for use in certain projects financed by Asian Development Bank and being implemented by Rajasthan Urban Infrastructure Development Project, Jaipur. There is no dispute that the necessary certificates as per the requirement of the exemption notification certifying that the goods supplied are required for the projects and that the projects are financed by the Asian Development Bank through loan and have been duly approved by the Govt. of India, have been produced. The only objection of the Department is that the respondent‟s name is not mentioned as supplier of the material in the certificates. But since it is not denied that the respondent have supplied the material to the persons mentioned in the certificates and there is no allegation of diversion of the material supplied for any other purpose, in view of the judgment of the Hon‟ble Madras High Court in case of Caterpillar India Pvt. Ltd. (supra), the benefit of exemption cannot be denied. Therefore, there is no infirmity in the impugned order. The Revenue‟s appeal is dismissed and the cross-objection also stands disposed of."
11. In our view, the decision of Madras High Court which has been confirmed by the Supreme Court, is required to be followed. Apart from that, the letter dated 2-5-2005 has been clarified by Commissioner (Appeals) that the goods were supplied by the assessee. In that view of the matter, while construing the provisions, the authorities have rightly considered the documents. However, a contention has been raised that a certificate ought to have been issued in favour of the assessee. In view of the letter dated 2-5-2005, things are clarified, therefore, in our view, there is no error committed by the authority or Tribunal. No substantial question of law arises for consideration by this Court. The appeal deserves to be and is dismissed.
The Hon‟ble High Court while delivering the aforesaid judgment has relied upon the judgment of Hon‟ble High Court of Madras in case of COMMISSIONER OF C. EX., PONDICHERRY Vs. CATERPILLAR INDIA PVT. LTD. 2013 (297) E.L.T. 8 (Mad.) held that when it is not in dispute that the goods has gone for the intended purpose the exemption under notification No. 108/95- CE cannot be denied. The operative portion of the order is as under:
8. We do not find any justifiable ground to interfere with the order of the CESTAT based on a factual finding and there was no material placed by the Revenue on the allegations of the possible misuse of the goods for unintended purposes by the sub-contractors. Secondly, being the beneficial Notification issued in public interest and the project itself being executed fully by the Contractors as per the directions of the Project Implementing Authority, the fact that the machineries were not 19 | P a g e E/11049-11055/2014-DB given directly to the project implementing authority but given to the agency executing the work in fact cannot go against the assessee‟s claim. Thus ultimately, as the machineries had been put in use by the sub-contractors, who were given the job of execution the claim for exemption cannot be denied. The use of the phrase „supplied to the projects financed by the said United Nations or an International Organisation and approved by the Government of India‟ clearly shows that the condition for grant of exemption is supply of the goods towards the project and nothing beyond. The extract of the Notification No. 108/95-
C.E., dated 28-8-1995 reads as follows :-
"In exercise of the powers conferred by sub-section (1) of Section 5A of the Central Excises and Salt Act, 1944, (1 of 1944) read with sub-section (3) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts all goods falling under the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) (here-inafter referred to as the said goods) when supplied to the United Nations or an International organisation for their official use or supplied to the projects financed by the said United National or an international organisation and approved by the Government of India, from the whole of :-
(i) the duty of excise leviable thereon under Section 3 of the Central Excises and Salt Act, 1944 (1 of 1944). and
(ii) the additional duty of excise leviable thereon under sub-
section (1) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957)."
Thus with all the conditions satisfied, the beneficial Notification applies to the case on hand. In the circumstances, we do not find any justification to introduce any condition or read in a restrictive manner. Consequently, the Revenue‟s appeal fails and hence, the same is dismissed. No costs.
The above judgment of the Hon'ble High Court stands maintained by the Hon'ble Apex Court as reported in Commissioner v. Caterpillar India Pvt. Ltd. - 2016 (335) E.L.T. A27 (S.C.).
18. In view of above judgments and facts of the case we are thus of the view that there is no reason to demand duty from the Jamnagar Mobile Plant or Dehgam mobile plant on the ground that there name is not appearing on the certificate and hence liable to pay duty since they have manufactured goods as job worker and the fact of goods being cleared to GWSSB is not in dispute. As far as demand of cenvat credit against SSTP plant and SP plant is concerned we find that it is not in dispute that the goods were manufactured on their behalf by Jamnagar Mobile Plant who is job worker. Thus for all purposes it is SSTP and SP Plant who are the principal manufacturer and the credit has been rightly availed by them. Further once both the plants were given permission to 20 | P a g e E/11049-11055/2014-DB clear the job work goods directly from the premises of the job worker, it itself shows that both the divisions were considered as principal manufacturer and eligible for credit of the raw material so used by the job worker. The order of Tribunal relied upon by the revenue in case of M/s Safelex International Ltd is not applicable to the present set of facts as in the said case no factory was in existence of Principal manufacturer who was supposed to get the goods manufactured under Notification No. 214/86 and it was a small shop with no machinery whereas in the present case the Principal manufacturer is itself a big plant and existence of factory is not in question. Further the larger Bench judgment in case of Thermax Babcock & Wilcox Ltd. Vs, CCE, Pune - I 2017 (12) TMI 266 - CESTAT - LB is not applicable in the present set of facts as principal manufacturer did not absolve themselves from payment of duty wherever payable.
19. As regard demand of cenvat from the principal manufacturers and job worker in case of pipes manufactured for exports or domestic customers we find that in case of Work Order No. EXP-207, EXP- 210 and EXP-216, the duty of Rs. 29,33,719/-, Rs. 47,68,608/- and of Rs. 21,84,312/- has been demanded from Kutch Division on the ground that being manufacturer of goods they should have paid duty. The said goods were cleared by SSTP Division for Export which is not in dispute. We find that in this case it is not disputed that the raw material was used by the Kutch Division on account of SP Division and the finished goods were ultimately exported. The adjudicating authority has demanded duty on the ground that no record was maintained by the Kutch division and the goods were cleared to SSTP division without payment of duty. We, in this context, find that the processing of goods on raw material owned by SSTP division is not disputed. Further the export of goods is also not disputed. The SSTP Division and Kutch Division both are part of same Appellant. The goods were cleared for export by SSTP Division. In such case even if duty is paid by the Kutch Division the rebate of the same is available. Moreover in case of job work the goods are to be returned to principal manufacturer and the exemption cannot be denied for procedure infractions. Further in case of Work Order No. EXP-216 and EXP-246, the cenvat credit has been denied to the tune of Rs. 8,43,465/-. We find that it is not in dispute that the inputs on account of SSTP Division were used by the Kutch 21 | P a g e E/11049-11055/2014-DB Division in manufacture of such export goods. Since the Kutch Division has acted as job worker and the export of goods on account of SSTP Division is not in dispute, the SSTP Division is eligible for cenvat of raw material used in such goods.
20. In case of domestic supply the demand of duty in respect of Work Order No. 7156 has been made from SSTP Division that it should have paid duty while removing the goods to Kutch Division. We find that the SSTP Division is only a job worker and the goods came to Kutch Plant being the principal manufacturer under rule 4 (5) (a). Further the duty payment made by the Kutch Unit has not been disputed. The duty cannot be paid on same goods twice. Therefore it cannot be said that the clearance from Kutch unit was shown to claim benefit of exemption notification 39/2001. In case of Work Order No. 9246 the demand of duty Rs. 2,20,021/- has been made from STP Division that the goods were cleared under invoice of Kutch Division. We find that the SSTP Division has acted as job worker and the duty on said goods has been paid by Kutch Plant which has not been disputed. Hence now the duty demand cannot be made from SSTP Division. Further in case of same work order demand of credit of Rs. 6,71,230/- has been made from Kutch Division on the ground that an amount of credit of Rs. 1,65,944/- was used in pipe manufactured at SSTP Division from coil sent by Kutch Division. However it also remains a fact that the pipes so manufactured were cleared by Kutch Division on payment of duty, hence there is no reason to deny cenvat to Kutch Division. Similarly in case of remaining amount of Credit of Rs. 5,05,275/- the duty on pipes stands paid by the Kutch Division. The SS Plates were used at SSTP Division to manufacture such pipes. When the manufacture of pipes and clearance of same on duty payment by Kutch Division is not in dispute, there is no reason to demand cenvat on SS Plates so used. Thus the demand is not sustainable. The tribunal in case of M/s Maschmeijer Aromatics (I) Ltd. vs. CCE 1980 (46) ELT 395 (TRI) held that modvat is available even in case of inputs sent out of factory for further processing but necessary permission not taken from Collector, if inputs after reprocessing utilised for end-product for which MODVAT concession is extended - Rule 57F (2) of Central Excise Rules, 1944.
21. In case of Work Order No. 454 demand of cenvat credit of Rs. 7,55,570/- from SP Division has been made. Similarly in case of Work 22 | P a g e E/11049-11055/2014-DB order No. 468 cenvat demand of Rs. 80,61,828/- against SSTP Division has been made. The cenvat demand has been made denying credit of HR Plates used in exempted goods alleging that both were maintaining separate records, hence the reversal of 10% of the value of exempted goods made by them in terms of Rule 6 (3) of CCR is not correct as it applies only in case where manufacturer opts not to maintain separate account. We find that both the division has maintained separate record only in case of one input i.e. HR plates. In such case when they have not maintained separate account of other inputs and have also availed credit of all the inputs including HR plate, in that case they have correctly reversed 10% of the value of exempted goods. The option in such case either to reverse the cenvat or pay 10% amount of the value of exempted goods was with them, Since they have reversed the 10% amount, the recovery of cenvat credit availed by them cannot be made.
22. In respect of Work Order No. 456 the cenvat credit of Rs. 28,92,922/- has been denied to SP Division on the ground that the goods were manufactured on job work basis by SP division for M/s Modern Construction. It has been contended that since the goods were directly delivered to Kutch Division hence the credit to SP Division is not available. We find that though the inputs were directly consigned to Kutch Division but later on came back to SP Division. Further it is also a fact that Kutch Division had not commercial production in August'2005 whereas the period of receipt of inputs pertained to April/ May'2005. Also the fact of sending of pipes to Modern construction is not in dispute. There is no other evidence with the revenue to show that the raw material was used elsewhere. In such case we do not find any reason to uphold the demand. We are also of the view that only for the reason that the condition of Rule 4 (5) (a) was not followed the cenvat cannot be demanded from the job worker, if it is found that the finished goods were either cleared on payment of duty by the principal manufacturer or were exported as the case may be.
23. As regard contention of the Appellant that the demands are time barred, we find that the issue involved is interpretation of job work rules and procedure and not of causing intentional loss of revenue. Whatever goods were cleared were either exempted from duty under Notification No. 108/95- CE dated 28.08.1995 or were cleared for exports or were 23 | P a g e E/11049-11055/2014-DB cleared into domestic market on payment of applicable duty. All the receipts of raw material and the clearance of finished goods stands recorded in statutory books. Moreover it is also a fact that all the division which availed credit or from which the finished goods were cleared belong to the same company and the duty if payable by one division was availed as credit to other division or was refundable. In our view in such scenario there is no reason to hold that the Appellant had any intention to evade duty. We thus hold that the demands are not sustainable being barred by limitation.
24. For the above reasons and findings we hold that the demands and penalties against the Appellant M/s Ratnamani Metals & Tube Ltd. are not sustainable. Consequentially the penalties imposed upon all the other remaining appellants are also not sustainable. We therefore set aside both the impugned orders dated 26.11.2013 and 28.11.2013 and allow all the appeals with consequential reliefs, if any.
(Pronounced in the open court on 17.01.2019)
(Raju) (Ramesh Nair)
Member (Technical) Member (Judicial)
Seema