2014 (7) TMI 943 - AT - Central Excise

Job Work - SSI units - intermediate goods which come into existence in their factory premises which are not specified goods - exemption under notification no.83/1994-CE and notification no.8/2003-CE - extended period of limitation - Held that - The argument taken by the appellant that for any duty liability on the intermediate goods, that come into the existence in appellant s factory, lies with the raw material supplier is not correct because as per the wording of the undertakings only duty liability with respect to the finished specified goods is required to be discharged by the raw material suppliers. The duty liability on the manufactured goods, which come into existence and are captively consumed for which exemption is not available under SSI exemption. - Decided against the assessee. Extended period of limitation - Held that - Being in the manufacturing and job work of goods of Chapter 74 of the Central Excise Tariff Act, 1985 it has to be held that appellant was aware that brass billets / rods come into existence and that brass billets weighing upto 5 Kgs. and certain other goods of copper are not specified goods. In view of the above, the extended period under Section 11A of the Central Excise Act, 1944 is invokable in the present proceedings. - Demand confirmed - Decided against the assessee.

Summary

Issues:
1. Duty liability on intermediate goods under notification no.8/2003-CE.
2. Applicability of exemption notifications no.83/1994-CE and 84/1994-CE.
3. Invocation of extended period for demand.

Analysis:

Issue 1: Duty liability on intermediate goods under notification no.8/2003-CE:
The appellant argued that the duty liability for intermediate goods lies with the raw material suppliers as per undertakings given. However, the Tribunal observed that duty liability for goods not specified under the exemption notification is to be discharged by the appellant/job worker. Citing the case of Super Polyfabriks Ltd., the Tribunal confirmed that duty liability on captively consumed goods not eligible for exemption falls on the appellant. A similar view was upheld in the case of Astron Engineers (I) Pvt. Ltd. The duty demand on intermediate goods was confirmed on merits.

Issue 2: Applicability of exemption notifications no.83/1994-CE and 84/1994-CE:
The Tribunal noted that the exemptions under these notifications apply to specified goods sent back to raw material suppliers availing SSI exemption. The argument that duty liability rests solely with the suppliers for finished goods was rejected. The Tribunal emphasized that duty liability for goods not covered by SSI exemption falls on the appellant/job worker, as clarified in previous judgments.

Issue 3: Invocation of extended period for demand:
Regarding the time bar, the appellant contended that all required intimations and declarations were filed, and clearances were properly documented. However, the Tribunal found discrepancies in the declarations and challans regarding the manufacturing process of job work and the existence of non-specified goods. As details were lacking, the extended period under Section 11A of the Central Excise Act, 1944 was deemed applicable. The case was decided against the appellant due to insufficient information and the extended period was upheld.

In conclusion, the appeal filed by the appellant was dismissed based on the duty liability for intermediate goods, the applicability of exemption notifications, and the invocation of the extended period for demand.