2009 (3) TMI 869 - AT - Central Excise

Summary

Issues:
- Pre-deposit of duty demand, interest, and penalty under Cenvat Credit Rules, 2004.
- Denial of Cenvat credit on duty paid by job worker for chrome plating process.
- Applicability of Cenvat credit once duty has been paid.

Analysis:

The judgment by the Appellate Tribunal CESTAT BANGALORE dealt with the requirement for the appellant to pre-deposit a significant amount comprising duty demand, interest, and penalty under the Cenvat Credit Rules, 2004. The appellant, engaged in manufacturing pistons and rings, faced a challenge from the Revenue regarding the denial of Cenvat credit on duty paid by a job worker for a chrome plating process. The appellant had taken Cenvat credit on duty discharged by the job worker, leading to the Revenue's objection that the job worker's process did not amount to manufacture.

During the hearing, the appellant's advocate presented the case, emphasizing that the appellants had a strong merit-based argument. The Tribunal noted that the appellants had indeed taken credit on duty paid by the job worker, citing precedents such as Commissioner of Central Excise, Goa v. Courtaulds Packaging (I) Ltd., Tata Oil Mills Co. Ltd. v. CCE, Cochin, CCE, Jaipur v. D.K. Processors (P) Ltd., and International Auto Ltd. v. CCE, Bihar, to support the position that Cenvat credit can be claimed once duty has been discharged.

In light of the arguments and precedents presented, the Tribunal ordered the waiver of the pre-deposit requirement for the entire amount demanded in the impugned order. The stay application was allowed, with a specific directive that there should be no recovery of the amount even after 180 days from the date of the order. The appeal was scheduled to proceed for hearing in due course, with the pronouncement and dictation of the order made in open court.