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2010 (5) TMI 795 - AT - Central ExciseWhether the credit of duty paid on inputs and input services is admissible to the job workers clearing goods to the principal manufacturer under N/N. 214/86-CE and also clearing waste generated on payment of duty? Held that - the issue is covered by the decision of Larger Bench of the Tribunal in the case of M/s Sterlite Industries Ltd. 2004 (12) TMI 108 - CESTAT MUMBAI where it was held that Modvat credit of duty paid on the inputs used in the manufacture of final product cleared without payment of duty for further utilisation in the manufacture of final product which are cleared on payment of duty by the principal manufacturer would not be hit by provision of Rule 57C - the Commissioner (Appeals) considered the decision of the Tribunal as decision of Hon ble Supreme Court in the case of M/s Tata Motors Ltd. 2009 (8) TMI 865 - CESTAT MUMBAI and did not follow the decision of Tribunal in case of M/s Sterlite Industries Ltd. Since the facts are same and issue is covered by the decision of the Tribunal in the case of M/s Sterlite Industries Ltd. the appeal filed the appellant is required to be allowed - appeal allowed - decided in favor of appellant.
Issues:
Admissibility of credit of duty paid on inputs and input services to job workers under Notification No.214/86-CE. Analysis: The judgment by the Appellate Tribunal CESTAT AHMEDABAD, delivered by B.S.V. Murthy, revolves around the issue of whether the credit of duty paid on inputs and input services is permissible to job workers clearing goods to the principal manufacturer under Notification No.214/86-CE. The Tribunal considered the appeal, noting that the matter involves a concise question and was thoroughly examined. The appellants relied on a decision of the Larger Bench of the Tribunal in the case of M/s Sterlite Industries Ltd. to support their claim of eligibility for duty credit on inputs used by job workers. However, the Commissioner (Appeals) had referenced a judgment allegedly overruling the decision of the Larger Bench by the Hon'ble Supreme Court in the case of M/s Tata Motors Ltd. Subsequently, it was clarified that the decision cited by the Commissioner (Appeals) was actually a Tribunal decision, not from the Hon'ble Supreme Court, and that it was later overturned by the Hon'ble High Court of Mumbai. The Tribunal determined that the issue at hand aligns with the decision of the Larger Bench in the case of M/s Sterlite Industries Ltd., emphasizing that the Commissioner (Appeals) mistakenly treated the Tribunal's decision as that of the Hon'ble Supreme Court and failed to adhere to the precedent set by the Tribunal in the case of M/s Sterlite Industries Ltd. Given the similarity in facts and the applicability of the Tribunal's decision in the case of M/s Sterlite Industries Ltd., the appeal filed by the appellant was deemed meritorious and thus allowed by the Tribunal. In conclusion, the judgment clarifies the admissibility of duty credit on inputs and input services for job workers under Notification No.214/86-CE, reaffirming the precedence set by the Tribunal in the case of M/s Sterlite Industries Ltd. and correcting the misinterpretation by the Commissioner (Appeals) regarding the applicability of a Tribunal decision versus a judgment of the Hon'ble Supreme Court.
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