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TMI Blog2022 (5) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, no cenvat credit was taken on such goods accordingly, such goods cannot be treated as excisable goods hence, no question arise for confiscation of the goods - neither confiscation is legal nor the duty demanded on such goods is correct. Demand on C.I. Mould which was manufactured on job work basis in terms of Notification No.214/86-CE - HELD THAT:- As per the undisputed facts, the various suppliers were supplying the old and used moulds to the appellant for converting into new mould and returning it back to the principal supplier. In this regard all the suppliers have filed a declaration as required under Notification 214/86-CE. This arrangement is permissible under which the job worker is exempted from payment of any excise duty in terms of notification No.214/86-CE. - All the documents and records clearly show that the appellant have received the old and used moulds and converted into fresh mould and returned back to the supplier of old and used mould for which they merely charged the job work charges. Whether old and used mould/scrap can be cleared under Rule 4(5)(a) or not - HELD THAT:- It is no longer under dispute as per the various judgments cited by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pak Rathod, have filed present appeals against Order-In-Original No. BVR-EXCUS-000-COM-17 TO 019 -15-16 dated 16.09.2015 passed by the Commissioner of Central Excise, Bhavnagar, wherein demand of excise duty Rs. 8,09,39,585/- and cenvat credit demand of Rs. 49,825/- was confirmed with interest and penalty and also a separate penalty of Rs.2,00,00,000/- was imposed on Shri Dipak Rathod. 1.1 The brief facts of the case are that appellant was engaged in manufacturing of C.I. Castings Moulds and are availing the Cenvat Credit of duty paid on the input used in or on relation to manufacture of the final products and are also manufacturing of C.I. Moulds on Job Work basis. The Factory premises of Appellant searched by the department and noticed that the Appellant is manufacturing C.I. Moulds out of the material purchased as also old and used Moulds supplied by some other manufacturers under intimation to the Central Excise Department and by following the procedure prescribed under Notification No. 214/86 dated 25.03.1986. The officers recorded the statement of employee and partner of Appellant and various suppliers of old and used mould supplied as raw material. Such investigation culm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were clandestinely cleared and hence, no duty can be demanded from the Job Worker. 2.2 He further submits that the Learned Commissioner has erred in confirming the demand of Rs. 4,32,019/- on the goods seized by the department. The goods seized includes the material supplied by various supplier for conversion into moulds on which neither the duty stands paid by the supplier nor any credit is availed by the Appellant. For storage of non-cenvatable material, outside the factory premises, neither any permission is required nor is there any Rule whereby the duty can be demanded by the department. The duty demanded on coal, stored outside the factory premises but in premises just opposite to the factory premises and in the premises owned by the Appellant, due to shortage of space, is also not liable to be confirmed in as much as the said material was duly accounted for and is proved to have been used in manufacturing of final product. The duty confirmed is liable to be set aside. 2.3 He also submits that Learned Commissioner has erred in disallowing the Cenvat Credit of Rs. 49,825/- as much as, the said goods are proved to have been used in manufacturing of final products and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of ground plan for inclusion of the premises where the goods were lying well in advance and subsequently, the ground plan was approved. Therefore, it cannot be said that the goods were lying outside the factory. Moreover, the appellant received the old and used moulds for the purpose of job work in their factory under Notification No.214/86-CE therefore, no cenvat credit was taken on such goods accordingly, such goods cannot be treated as excisable goods hence, no question arise for confiscation of the goods. Accordingly, neither confiscation is legal nor the duty demanded on such goods is correct. Moreover, the goods were subsequently taken into the factory and used in the manufacture for the job work. For this reason also demand and confiscation of the goods is not sustainable. 4.2 As regard the demand on C.I. Mould which was manufactured on job work basis in terms of Notification No.214/86-CE, the case of the department is that the appellants have manufactured and cleared fresh goods in the guise of conversion of old and used mould into the job worked goods, therefore, they are liable to pay duty. In this regard, as per the undisputed facts, the various suppliers were sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s per the facts of the case firstly, the appellant had not taken the cenvat credit when the goods were lying stored outside, the credit was taken only after taking the coal into the factory therefore, there is no violation of any Cenvat Credit Rules. Secondly, the coal was lying outside the factory but it was lying within the premises which is owned by the appellant only. As discussed above, the appellant had applied for inclusion of the said premises in the factory premises even before storing the goods and subsequently, the permission was granted and the said premises deemed to have been part and parcel of the registered premises of the appellant. For this reason also the Cenvat credit on coal cannot be denied. Since the demand itself is not sustainable, penalty on the main appellant as well as co-appellant is also not sustainable. 4.6 The appellants have strongly raised the defence on limitation on the ground that the job work transactions were clearly declared in the monthly ER-1 return therefore, there is no suppression of fact. We, prima facie find force in the submission of the appellant however, since we have decided the entire case of its facts and merit we are not goin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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