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TMI Blog2018 (5) TMI 2021X X X X Extracts X X X X X X X X Extracts X X X X ..... in he has held the duty liability against the appellants under the provisions of Central Excise Act, 1944 (for short the Act) along with penalty and applicable interest. Penalty has also been imposed on M/s Tata Steel Ltd., Jamshedpur under Rule 25 of Central Excise Rules, 2002 (for short the Rules). 2.1 Brief facts of the case are that M/s Tata Steel Ltd. (hereinafter referred to as Tata Steel) removed CR/HR Coils from their factory to their job workers the other appellants for cutting and slitting into different sizes as per requirement and used to pay Central Excise duty as per Rule 8 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 to its External Procession Agents (in short EPAs), namely, Tata Ry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part from other products under Chapter 72 of the Central Excise Tariff Act, 1985 and removed on payment of duty, on value arrived at under Rule 8 of the Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 to TRL-In/TRL-B/BMW (collectively in brief EPAs) for processing, which involved cutting and slitting, as per requirement of TSL, on job work basis. During the course of investigation, it was found that TSL have entered into an agreement with the EPAs for the pricing of the scrap/waste. As per the contract, CR/HR coils supplied for processing remain under the ownership of TSL and scrap/defective material arising during processing has to be removed to MRD (Material Reclamation/Recovery Division) of TSL on payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Steel, the said waste and scrap and rejected materials were removed by the said EPAs for delivery of Metal Junction, Jamshedpur, a joint venture company of Tata Steel and SAIL. He submits that the jurisdictional Central Excise Officers of M/s Tata Steel Ltd., on verification of the documents raised an issue of alleged short payment of Central Excise duty in the clearances of the said waste and scrap/rejected materials. It was contended on behalf of the Department that in spite of higher value being received on auction sale of the said waste and scrap/rejected materials than on the basis whereof Central Excise duty was paid thereon at the time of clearance from the premises of EPAs, the differential duty was alleged to be payable and thereb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC) i.e. on the cost of production + job worker's profit and therefore, Rule 7 of the Valuation Rules, has wrongly been applied by the ld.Commissioner in the impugned order. The ld.Sr. Advocate further submitted that there is no dispute that computation of excise duty by EPAs of the said goods cleared were done on the basis of the price declared by the Tata Steel, which was arrived at on the basis of principle laid by the Apex Court and therefore, there is no case of the under-valuation of the said goods during the impugned period. In any case, the disputed amount has already been paid by M/s Tata Steel on behalf of EPAs as well as on their own behalf along with interest and duly intimated to the jurisdictional Central Excise Authorities an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was accepted by the CBEC and accordingly,Board's Circular No.584/21/2001-CX dated 07.09.2001 was set aside. In the said Circular, it was held that cutting of HR/CR Coils of iron of non-alloy steel into sheets or slitting into strips of lesser width or slitting of sheets into strips will amount to manufacture if the resultant product is classifiable under different sub-heading of the Central Excise Tariff. Subsequently, CBEC withdrew the Circular in 2005 by issue of Circular dated 2nd March, 2005, wherein it has been clarified that the activity of cutting and slitting of HR/CR Coils into required length do not amount to manufacture of Excisable goods within the meaning of Central Excise Act. In view of the aforesaid two Circulars, it is held ..... X X X X Extracts X X X X X X X X Extracts X X X X
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