2016 (11) TMI 865 - AT - Central Excise

Demand - denial of benefit of N/N. 214/86CE dated 25.03.1986 - job work - filing of undertaking with the jurisdiction officer of the job worker - Held that - I find that in this case the principal manufacture has filed declaration before the Assistant Commissioner having jurisdiction of the factory of the job worker and the said declaration have been accepted by the said Assistant Commissioner. In that circumstances, the Condition of the notification has been complied with by the principal manufacture. In that circumstances, the proceedings against the appellant are not warranted. Therefore, I hold that the appellant is entitled to benefit of notification no. 214/86-CE and the duty is not payable by the appellant - appeal allowed.

Summary

Issues:
Appeal against duty demand under Notification No. 214/86-CE due to filing of undertaking by principal manufacturer before the wrong authority.

Analysis:
The appellant, a job worker, was clearing goods without duty payment under Notification No. 214/86-CE. The principal manufacturer mistakenly filed the undertaking with the Assistant Commissioner of its jurisdiction instead of the Assistant Commissioner of the job worker's jurisdiction. A show cause notice was issued to deny the notification benefit, demand duty with interest, and impose a penalty. The appellant contended that the mistake was rectified by filing the undertaking with the correct authority, which was not considered by the adjudicating authority. The appellant also highlighted a previous instance where the demand was dropped for a similar mistake.

The appellant argued that since the principal manufacturer eventually filed the undertaking with the correct authority and discharged the duty on the job worked goods, the proceedings against the appellant were not sustainable. On the contrary, the respondent argued that the duty demand was valid due to the contravention of Notification 214/86-CE, citing a relevant case law.

After hearing both parties, the tribunal found that the principal manufacturer had filed the declaration with the Assistant Commissioner having jurisdiction over the job worker's factory, which was accepted. Consequently, the condition of the notification was met by the principal manufacturer. Therefore, the tribunal held that the appellant was entitled to the benefit of Notification No. 214/86-CE, and the duty was not payable by the appellant. The appeal was allowed, providing consequential relief, if any.