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TMI Blog2009 (2) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... nged and not the duty and interest, which was already paid - penalty imposed on the appellants is set aside - E/1021/2008 - A/491/2009-WZB/AHD - Dated:- 27-2-2009 - Shri B.S.V. Murthy, Member (T) Shri Piyush Sargoi , C.A. , for the Appellant. Ms. M.I.J. Micheal, Jt. CDR, for the Respondent. [Order].- Appellants are engaged in the manufacture of Phosphorus Acid Crystal and other chemicals falling under Chapter 29 of Central Excise Tariff Act 1985. On verification it was found that the appellants were sending their inputs for processing of their products Phosphorus Acid Crystal to job workers based at Krishna Chemicals, Vapi. During the process of the said products, a bye product Hydrochloric Acid emerges. The job worker ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avail Cenvat credit is retained with the manufacturers, not the job worker. The job worker is not required to pay duty even if a new product with a distinctive name, character and use come in to existence. (B) In order to give a benefit to manufacturers, to reduce unnecessary scriptory work or unnecessary transport between job worker and manufacturer's premises, permission was granted for excisable goods to be cleared directly from the premises of the job worker on payment of duty instead of being returned to the supplier. However, the duty continued to be paid by the manufacturer, or by the job worker on behalf of the manufacturer. This is confirmed by the terms Rule 57AC(5)(a) which requires return of inputs or raw material within 180 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... awkim Ltd. v. CCE, Pune - 2007 (218) E.L.T. 142 (Tri.-Mum.) Para - 5 "a job worker who manufactures the intermediate product, is not liable to pay any duty thereon ---. The rule requires the input supplier to pay duty on the intermediate product if it is not used further in the manufacture of final product and does not require the job worker to pay duty on the intermediate product." (d) Suvikram Plastex (P) Ltd. v. CCE Bangalore-III - 2008 (225) E.L.T. 282 (Tri.-Bang.) Para - 5.7 "When the raw material supplier sends the goods to the job worker and if the products resulting from the job worker are not to be paid duty or in other words, if they have to be cleared without payment of duty either by the job worker or by the principa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted certain cases to support their contention that the job worker is liable to pay duty. Respectfully, these are not good law. All the cases depend ultimately on the ratio of the decision at serial No. 10, which did not discuss the issue. (g) Rocket Engineering Corporation Ltd. v. CCE, Pune - 2008 (223) E.L.T. 347 (Bom.) The Hon'ble Bombay High Court held that there was no substantial question of law. The Tribunal order depended on the earlier cases listed below: (h) EMCO Ltd. v. Commissioner of Central Excise, Mumbai-III - 2008 (223) E.L.T. 613 (Tri.-Mumbai). In this case, the decision is on the basis of the decision on M/s. Preetam Enterprises. - 2004 (173) E.L.T. 26 (Tri.) (i) Preetam Enterprises v. Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontested the demand for duty which has already been paid by them with interest. Even in the memorandum of appeal filed, only penalty had been challenged and not the duty and interest, which was already paid. In view of the decision of the Hon'ble Bombay High Court in Rocket Engineering case [2008 (223) E.L.T. 347 (Bom.)], wherein it has been held that principal manufacturer need not pay the duty on the scrap which were not returned by the job workers and in view of the fact that waste and scrap and by products were treated at par in Modvat credit rules earlier, the contention of the appellants that no penalty is imposable, is to be upheld. As regards duty and interest already paid, in view of the provisions of Section 11A(2B), it is to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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