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TMI Blog2022 (11) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... aps, which have not been received from the job-worker, is required to be reversed or not. 3.1 The Appellant, M/s Forgings (India) Iron and Steel Limited, is engaged in the manufacture of various steel forgings as per drawing and specification of customers falling under Chapters 72, 73 & 84 of the First Schedule to the Central Excise Tariff Act, 1985. The Appellant got some of their goods manufactured through job-workers for which they sent inputs/semi-finished inputs from their factory to various job-workers in terms of Rule 4(5)(a) of the Cenvat Credit Rules, 2004, after taking Cenvat Credit on inputs. The semi-processed/ semi-finished inputs after being processed by job-workers, were returned to the Appellant. It appears to Revenue that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40/- 5. V(3)39-SCN/Forging(I)/HNDI/Adjn./13/443 dt. 29.10.2013 (Alloy & Non-Alloy Steel) Oct'12 March'13 Rs.4,99,868/- Total Rs.17,71,944/- 3.2 It is the case of the Department that the Appellants have not received back the quantity of waste and scrap from the job-workers, which amounts to clearance of the waste and scrap without payment of duty by the job-worker. As the Appellants have failed to reverse the proportionate Cenvat Credit attributable on inputs contained in such waste and scrap, it appears to the Revenue that the Appellant is liable to pay Cenvat Credit of Rs.17,71,944/- under Rule 14 of the Cenvat Credit Rules, 2004 read with Section 11A of Central Excise Act, 1944 for violating the provisions of Rule 4(5)(a) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party-wise and end of each month, the quantity of scrap not received back, is calculated and duty is paid on such scrap. It was further contended that as required under Rule 4 (5)(a) of Cenvat Credit Rules, 2004 read with Rule 57AC (v) of Central Excise Act, 1944, the Appellant has received back the processed inputs in its factory within 180 days and hence, there was no violation of the Act and the Rules as there is no obligation on the Appellant to bring back the waste and scrap. It was further contended that after enactment of new Central Excise Rules w.e.f. 01.04.2000, no such provision is made requiring principal manufacturer to reverse/pay Cenvat Credit on waste and scrap generated at job-workers' premises. It was further contended tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g aggrieved, the Appellant preferred an appeal before the Commissioner (Appeals), who vide the impugned order, upheld the Order-in-Original dated 31.12.2013. 5. Being aggrieved, the Appellants have preferred the appeal before this Tribunal on the ground among others that the findings of the Commissioner (Appeals) is erroneous in observing that there is no material change in the provisions with respect to job worker as existed prior to 1-4-2000 inasmuch as in the old Rule 57F(5)(i), waste and scrap arises in the course of processing of inputs at the place of job worker was required to be returned to the factory of the assessee and where such waste and scrap was not returned, the assessee was required to pay excise duty on such waste and scr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods are cleared to a job worker. It has been provided that they should be received back within 180 days. If they are not received, the manufacturer shall debit the Cenvat credit attributable to such inputs or capital goods, otherwise it will be an offence. However, the manufacturer shall be entitled to take Cenvat credit as and when the goods sent to the job worker are received back. If part of the goods are received back within 180 days and the rest of the goods are received back after 180 days, the obligation for debiting the credit shall arise only in respect of Cenvat credit attributable to that part which is not received within 180 days." 6. The purport of the clarificatory circular is that the processed inputs are required to be rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the appellant contends that following substantial question of law arises for consideration of this Court. - A. "Whether the assessee i.e. the supplier of inputs to the job worker is liable to pay Central Excise Duty on the scrap generated at the job worker end, which is not received back from the job worker within the specified time in terms of Notification No. 214/86-C.E., dated 25- 3-1986 as amended r/w Rule 4(5)(a) of Cenvat Credit Rules?" B. "Whether scrap generated at the job worker end out of the processing of the inputs is required to be returned to the supplier and, if it is not returned back whether the supplier of inputs is required to pay appropriate Central Excise thereon?" 3. Having heard rival parties and having exam ..... X X X X Extracts X X X X X X X X Extracts X X X X
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