Mohata Coal Company Pvt. Ltd Vs Commissioner of CGST (CESTAT Kolkata)
CESTAT Kolkata held that duty cannot be levied in absence of evidence proving that semi-finished products is sent to the hired premises with mala fide intention of the appellant.
Facts- Tender was allowed to the appellant for removing the goods for machining to other job workers and the appellant qualified for the Tender. M/s Durgapur Steel Plant (DSP) obtained the approval from the Commissioner of Central Excise for getting the job work of machining through the appellant and accordingly, had given declaration that they would be clearing the goods without payment of duty to the job worker and had also undertaken to pay the duty on receiving the returned goods at the time of clearance from their factory.
The Appellant, M/s Mohata Coal Company Pvt. Ltd. was undertaking the job work of receiving the goods under Annexure II Challan and returning the same to M/s DSP. The Appellant was finding it difficult to undertake the entire job work through their infrastructure within the time frame given and intimated to the DSP that they may be allowed to take the help of approved vendors for the machining of Wheels & Axles.
M/s Mohata Coal Company Pvt. Ltd., entered into a Hire Agreement dated 24.09.2015 with M/s Vardhaman Products (the Appellant No. 2 herein) for getting the machining job done. It paid hire charges to the tune of Rs.30,000/- per month for use of machines and other charges, such as wages of labourers and maintenance of machine and tools and electricity bills.
The Officers of the Department detained and seized the goods. The Department was of the view that sending of goods to M/s Vardhaman Products by M/s Mohata Coal Company Pvt. Ltd. without giving intimation to the Department was not proper and amounts to a violation of Rule 16B of the Central Excise Rules, 2002. It was also alleged that M/s Vardhaman Products contravened the provisions of Rule 16B of the Rules,2002 since they were receiving the goods for job work purposes but they were not permitted by the Department to receive such semi-finished goods of M/s DSP.
