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TMI Blog2012 (10) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... yment of duty (ii) They get raw material from some other Central Excise assessees, manufacture goods and clear it on payment of duty (iii) They get raw material under job-work challan from other Central Excise Assessee manufacture finished products and clear the goods under exemption Notification 214/86-C.E. That is to say these goods are either used in the further manufacture of the supplier or the supplier is clearing the goods on payment of duty. 2. The present dispute is about activity at (ii) and (iii) above. 3. The Revenue noticed that the Respondent had an agreement with suppliers of raw material at (ii) and (iii) above to give back finished goods with weight equal to 90% of the weight of r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in category (ii) in Para 1 6,74,994 B Duty on finished goods manufactured using raw material procured by the assessee to make good the excess buring loss and supply 90% by weight of raw materials supplied to suppliers as mentioned in category (iii) in Para 1 1,45,635 C Credit taken on invoices in the name of others 49,776 7. In adjudication proceedings duty amounting to Rs. 8,31,963 was demanded along with interest on components A and B in TABLE-II. Penalty equal to the said amount was imposed under Section 11AC of the Act. Duty amounting to Rs. 49,777 on component C in TABLE-II of the demand also was confirmed. Penalty equal to the this amount also was imposed under Section 11AC of the Act. A penalty of Rs. 10,000/- was impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner (Appeals). Revenue has a new case that such goods were cleared on the basis of value arrived at by cost construction method as laid down the case of Ujagar Prints [1988 (38) E.L.T. 535 (S.C.)]. But the goods are actually manufactured and sold and so value should have been arrived as per Section 4(a) of the Act. This is an altogether new issue being brought up in second Appeal for the first time. 11. Revenue also has a case that in respect of component B in TABLE-II clearances were not eligible for exemption under Notification 214/86 because the impugned goods were not made on job work basis from raw materials received. 12. They also content that penalty equal to Rs. 49776 should have been imposed on the respondent in resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding for postponement of payment of duty rather than an exemption from duty has been recognized in the decision of the Larger Bench of the Tribunal in Sterlite Industries (I) Ltd. v. C.C.E. - 2005 (183) E.L.T. 353. So there is hardly any difference between component A and component B of the demand in Table-II above. 16. In the matter of penalty for wrong Cenvat credit taken, I find that the intention to evade payment of duty has not been clearly broughtout in the order-in-original. So I consider it as bona fide mistake and there is no case to increase the penalty of Rs. 2000/- as upheld by the Commissioner (Appeals). I take note of the decision of the Division Bench of the Tribunal in Divgi Warner Pvt. Ltd. v C.C.E. - 2011 (268) E.L.T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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