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2014 (4) TMI 297 - AT - Central ExciseAvailing exemption for goods manufactured on job work basis in the absence of undertaking given by the supplier manufacturer - Suppliers being SSI units and are not registered but are availing exemption under SSI exemption notification - Notification No.214/2006 or 83/94 - Held that - in the challans the SSI units who had supplied the raw materials had specifically stated that they are availing the benefit of SSI exemption Notification and, if and when, they cross the limits prescribed under Notification they would pay duty. - once the goods have been supplied under challan and properly accounted for by both the principal manufacturer and the job worker, the benefit of Notification No.83/94 CE cannot be denied on the ground that there was no undertaking given by the principal manufacturer. - appellant is eligible for the benefit of Notification in respect of their supplies made to the SSI units. Decision in the case of decision in the case of International Engg. and Mfg. Services P. Ltd. 2000 (11) TMI 232 - CEGAT . distinguished - Decision in the case of Salem Weld Mesh 2007 (8) TMI 172 - CESTAT, CHENNAI and in the case of Bharat Foundry 2009 (2) TMI 606 - CESTAT, AHMEDABAD followed - Decided in favour of assessee.
Issues:
1. Eligibility for exemption under Notification No.214/2006 for goods manufactured on job work basis and cleared to third category of customers. 2. Eligibility for exemption under Notification No.83/1994 CE for supplies made to manufacturers availing SSI exemption. 3. Interpretation of conditions under Notification No.83/94 CE regarding the use of specified goods received from job worker. 4. Comparison of decisions in similar cases to determine eligibility for exemption. 5. Consideration of job worker as a manufacturer and fulfillment of Notification conditions. Analysis: 1. The appellant, engaged in hot deep galvanizing of iron and steel articles, claimed exemption for goods cleared to different categories of customers. The Commissioner allowed benefits under Notification No.214/86 for the first category of customers, but denied benefits under Notification No.83/94 CE for supplies to manufacturers availing SSI exemption and traders. This led to a demand confirmation of Rs.2,33,45,714/- for a specific period. 2. The Tribunal considered submissions and past decisions. It noted that benefits under Notification No.83/94 CE were denied due to the principal manufacturer not filing the required undertaking. However, relying on precedents like Salem Weld Mesh and Bharat Foundry, it held that the absence of an undertaking does not disqualify the job worker from exemption if goods were properly accounted for and used in manufacturing exempted goods. 3. The Tribunal emphasized the importance of proper documentation and compliance with Notification conditions. It highlighted that the job worker should be considered a manufacturer for certain purposes and that failure to meet Notification requirements can affect eligibility for exemption. 4. The Tribunal compared the facts of the case with relevant decisions, finding that the appellant's situation aligned with cases where benefits were granted. It stressed the significance of specific details in challans provided by SSI units supplying raw materials, indicating their compliance with exemption limits. 5. The discussion also addressed the argument that the appellant, as a job worker, should be considered a manufacturer. It differentiated the case at hand from International Engg. and Mfg. Services P. Ltd., where raw materials were received without proper documentation, leading to a denial of exemption benefits. In conclusion, the Tribunal allowed the appeals, confirming the appellant's eligibility for the claimed exemptions. The rejection of the Revenue's appeal underscored the merit in the appellant's position based on compliance with Notification requirements and supporting documentation.
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