2006 (3) TMI 460 - AT - Central Excise

Summary

Issues:
1. Denial of benefit under Notification No. 214/86-C.E. to job worker.
2. Applicability of Rule 57AC in lieu of said Notification.
3. Comparison of provisions of Rule 57AC with erstwhile Rule 57F(4).
4. Tribunal's decision in Trico Process Pvt. Ltd. v. CCE, Mumbai-III [2005 (189) E.L.T. 126 (Tri.-Mumbai)].

Analysis:
The case involved the denial of benefits under Notification No. 214/86-C.E. to a job worker who received man-made fabrics from the principal manufacturer for processing and returning them. The authorities confirmed duty against the appellant, citing exclusion of man-made fabrics from the notification's benefit due to not being listed as eligible final products for job work exemption.

The appellant contended that if the notification's benefit was not applicable, they should be entitled to benefits under Rule 57AC, similar to erstwhile Rule 57F(4) of the Central Excise Rules, 1944. They argued that they followed the required procedure for processing the fabrics on a job work basis and relied on the Tribunal's decision in Trico Process Pvt. Ltd. v. CCE, Mumbai-III, which stated that job workers are not liable to duty on processed goods as per Rule 57F(4).

The Tribunal found that the provisions of Rule 57AC were indeed identical to erstwhile Rule 57F(4) and noted that the appellant had followed the procedure under Notification No. 214/86, which was akin to the requirements of Rule 57AC. Consequently, the Tribunal held that the appellant had established a prima facie case in their favor, warranting the unconditional allowance of the stay petition.

In conclusion, the Tribunal's decision emphasized the alignment between Rule 57AC and the previous Rule 57F(4), recognizing the appellant's compliance with the procedural requirements and granting them relief based on the established legal precedent and procedural adherence.