2017 (9) TMI 496 - AT - Central Excise

Job-work - goods sent to job-worker for processing and received back - case of Revenue is that Central Excise duty should have been paid by them before the goods were sent for job work - Held that - it is an admitted fact that the goods on which Central Excise duty amounting to ₹ 48,07,703/- was demanded were the goods on which appropriate Central Excise duty was paid before clearance from the factory after being received from the job workers - through the said SCN dated 25/09/2009 Revenue has raised the demand of Central Excise duty on the goods which have already suffered Central Excise duty. Such type of demand of Central Excise duty on the goods on which Central Excise duty was already paid is not provided for in Central Excise Act, 1944. Therefore, the SCN is not sustainable - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appeal against Order-in-Appeal No.68/CE/APPL/ALLD dated 07/06/2011 passed by Commissioner of Central Excise (Appeals), Allahabad.

Analysis:
The case involved the appellants engaged in the manufacture of Aluminium & Products thereof, who were issued a Show Cause Notice for clearing finished Aluminium Extruded Section to their job workers without payment of Central Excise duty. The Notice demanded duty amounting to ?48,07,703 under Sub-section (1) of Section 11A of Central Excise Act, 1944, for the period from September 2004 to August 2008. The Order-in-Original confirmed the demand, leading to an appeal before the Commissioner (Appeals), who rejected the appeal through Order-in-Appeal No.68/CE/APPL/ALLD dated 07/06/2011. Subsequently, the appellant approached the Tribunal challenging the order.

During the proceedings, the appellant argued that the goods sent for job work, namely Aluminium Extruded Section, had Central Excise duty paid upon their return to the factory after processing. The Revenue contended that duty should have been paid before sending the goods for job work. The Tribunal noted that the goods on which duty was demanded had already undergone Central Excise duty payment upon return to the factory, rendering the additional demand unsustainable under the Central Excise Act, 1944. Consequently, the Tribunal set aside both the impugned Order-in-Original and Order-in-Appeal, allowing the appeal and granting the appellants consequential relief as per law.

In conclusion, the Tribunal ruled in favor of the appellants, holding that the demand for Central Excise duty on goods that had already undergone duty payment was not permissible under the Central Excise Act, 1944. The decision emphasized the importance of adherence to the legal provisions governing the payment of duties and highlighted the need for proper assessment before raising demands for duty payments.