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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 ..... p has taken place at the end of principal manufacturer, duty cannot be demanded from the principal manufacturer. The waste and scrap are not manufactured goods whether they are generated at the premises of the principal manufacturer or at the premises of job-worker and accordingly, the legislature have consciously not made any provisions for reversal of any credit taken on duty paid inputs in case of clearance of waste and scrap and/or, there non-return from the job worker s premises under the Central Excise Rules, 2002 read with Cenvat Credit Rules, 2002/2004. The demand of duty, interest and imposition of penalty upon the Appellant is set aside by holding that the Appellant was under no obligation to pay duty on waste and scrap used at the job worker s end - appeal allowed. - Excise Appeal No.77198 of 2018 - FINAL ORDER NO.75568/2022 - Dated:- 17-11-2022 - MR. P.K. CHOUDHARY, MEMBER (JUDICIAL) Shri Aditya Dutta, Advocate for the appellant Shri A.Roy, Authorized Representative for the Respondent ORDER The present appeal filed by the Appellant, M/s Forgings (India) Iron and Steel Limited, arises from Order-in-Appeal No.25/Kol.II/2017 dated 25.04.2017 p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SCN/Forging (I)/HND-I/Adjn./11/3420 dt. 09.10.2012 (Alloy Non-Alloy Steel) Oct 11 March 12 Rs.4,95,536/- 4. C. No. V (3)8-SCN/Forging (I)/HND-I/Adjn./13/1498 dt. 05.04.2013 (Alloy Non-Alloy Steel) April 12 Sep 12 Rs.1,19,440/- 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be sent to a job-worker for various purposes, like, further processing grinding, teeth cutting, bending, ring cutting, testing etc. and only condition imposed under the Rule that the Appellant shall satisfy, is that the processed goods are received back within 180 days. Further reliance was placed on the ruling in the case of Fag Engineering (I) Ltd. Vs. Commissioner of Central Excise, Vadodara : 2011 (266) ELT 193 (Tri.-Ahmd.). 3.5 All the five Show-cause notices culminated into the Order-in-Original dated 31.12.2013, observing that there is no material change in respect of the provisions for job-worker in the Rules prior to 01.04.2000 or subsequent to it under the Central Excise Rules, 2000. It was further held that Rule 4(5)(a) of Cenvat Credit Rules, 2004 also requires that if goods sent for job-work are not received back within 180 days, then the manufacture shall pay the amount equivalent to Cenvat Credit attributable to the inputs and the manufacturer can pay Cenvat Credit again, when the inputs or capital goods are received back in the factory. Accordingly, the contention of the Appellant was not found tenable and the proposed demand of Rs.17,71,944/- was confirmed alon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion has now been made if the inputs or capital goods 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 received back from the job worker and any waste and scrap generated in the premises of job-worker are not required to be received back and accordingly credit of duty availed in respect of such inputs contained in the waste and scrap so generated cannot be denied. 7. From the above discussion, it becomes clear that duty is being demanded by treating them as a manufacturer of waste and scrap, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Representative appearing on behalf of the Revenue, justified the impugned order and prays that the appeal filed by the Appellant be dismissed being devoid of merit. 9. Heard both sides and perused the appeal records. 10. The issue having been decided in the case of M/s. Rocket Engineering Corpn. Ltd. as also in the case of M/s. Emco Ltd. v. CCE, Mumbai, 2008 (223) E.L.T. 613 (Tri.-Mum.), laying down that waste and scrap used at the end of job worker cannot be held to be dutiable in the principal manufacturer s hands, I am of the view that the duty confirmed against the appellant is not justified. Further, the Tribunal s decision stand upheld by Hon ble High Court of Mumbai as detailed supra. There is no contra decision shown to me. 11. I find that the waste and scrap are not manufactured goods whether they are generated at the premises of the principal manufacturer or at the premises of job-worker and accordingly, the legislature have consciously not made any provisions for reversal of any credit taken on duty paid inputs in case of clearance of waste and scrap and/or, there non-return from the job worker s premises under the Central Excise Rules, 2002 read with Cenvat Cre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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