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TMI Blog2014 (12) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... spondent : Shri P. Arul, Superintendent (AR) JUDGEMENT Both the appeals are arising out of a common order and therefore both are taken up together for disposal. 2. The relevant facts of the case, in brief, are that M/s. G. Plast (P) Ltd. have two units, namely Unit I and Unit - II. Both the units are engaged in the manufacture of Aluminium components classifiable under Chapter 76 of the CETA, 1985. They were availing CENVAT credit benefit under the CENVAT Credit Rules, 2002 on inputs and capital goods. Unit - I availed CENVAT credit on capital goods and cleared as such under the cover of challans to their Unit - II. On 25.3.2003, the Central Excise officer during their visit found that Unit - I removed the capital goods as such to Unit - II without reversal of the credit. The said officers seized the capital goods lying in Unit - II. Subsequently, Unit - I applied for provisional release of the seized capital goods, which were seized on 25.3.2003. The seized goods were provisionally released. A show-cause notice dated 12.8.2003 was issued by the Additional Commissioner of Central Excise proposing to confiscate the seized capital goods under Rule 13 of the CENVAT Credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers premises for production of goods. (b) Commissioner (Appeals) erroneously proceeded on the basis that Rule 4(5)(b) allowed removal of jigs, fixtures, moulds and dies to a job worker for the production of goods on his behalf and therefore any other capital goods would not eligible to remove from the factory as such for the production of goods. The difference between rule 4(5)(a) and Rule 4(5)(b) is that there is no time limit prescribed in clause (b) of Rule 4(5) whereas there is a time limit of 180 days in clause (a) of Rule 4(5). Relied upon the decision of the Tribunal in the case of Sree Ganesar Textile Mills Ltd. Vs. CCE- 2006-TIOL-276-CESTAT-BANG. (c) It is a case of inter-unit transfer for use in the manufacture of same final product and therefore confiscation of goods and penalties are not sustainable. He relied upon the decision of the Tribunal in the case of Pooja Forge Ltd. Vs. CCE - 2006 (196) ELT 18 upheld by the Hon ble Punjab and Haryana High Court as reported in 2008 (229) ELT 46 (P H). (d) At any event, Unit - I paid the duty and Unit - II availed the CENVAT credit and it is a clear case of revenue neutrality and relied upon the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f production of the goods. It is contended by the learned consultant that Unit - II is a job worker, who returns the goods to Unit - I after job work. The learned counsel submitted that they have cleared the goods under Rule 4(5)(a) of Rules, 2002. The relevant portion of Rule 4(5) is reproduced below:- 4(5)(a) The CENVAT credit shall be allowed even if any inputs or capital goods as such or after being partially processed are sent to a job worker for further processing, testing, repair, re-conditioning or any other purpose and it is established from the records, challans or memos or any other document produced by the assessee taking the CENVAT credit that the goods are received back in the factory within one hundred and eighty days of their being sent to a job worker and if the inputs or the capital goods are not received back within one hundred eighty days, the manufacturer shall pay an amount equivalent to the CENVAT credit attributable to the inputs or capital goods by debiting the CENVAT credit or otherwise, but the manufacturer can take the CENVAT credit again when the inputs or capital goods are received back in his factory. (b) The CENVAT credit shall al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CENVAT Credit Rules, 2002, CENVAT is admissible only when inputs and capital goods which are used by the manufacturer within the factory premises except when inputs or capital goods are used/sent for job work outside factory. The Hon ble Supreme Court in the case of Vikram Cement Vs. CCE -2006 (197) ELT 145 (SC) with reference to eligibility of MODVAT / CENVAT credit on inputs and capital goods used in mines, mainly explosives, lubricating oils etc., held that if the mines are captive mines so that they constitute one integrated unit together with the concerned unit cement factory, MODVAT/CENVAT credit on capital goods will be available to the assessee. On the other hand, if the mines are not captive mines but they supply to various other cement companies of different assessees, MODVAT/CENVAT credit on capital goods used in such mines will not be available to the concerned assessees under the appropriate MODVAT/CENVAT credit. 9. The Tribunal in the case of Pooja Forge Ltd. (supra) observed that capital goods were moved only between the appellant s own unit and that too for use in the manufacture of same final products. It does not involve any disposal or alienation of capital go ..... X X X X Extracts X X X X X X X X Extracts X X X X
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