TATA MOTORS LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) The appellant is engaged in the manufacture of motor vehicles. During the period of dispute (April 2000 to March 2003), they had sent iron castings under cover of challans to their job workers for the purpose of machining and the machined castings were returned within the period 180 days prescribed under Rule 57AC of the Central Excise Rules, 1944. However, the scrap generated at the job workers' premises was not so returned. This material was disposed of by the job workers themselves. In the show -cause notice issued, the department demanded from the appellant 'differential duty" equivalent to CENVAT Credit of the duty paid on the input contained in the scrap. This demand was raised under Rule 57AH of the Central Excise Rules, 1944 read with Rule 12 of the CENVAT Credit Rules, 2001, as also under Section 11A(1) of the Act. Interest on such duty was also demanded under Section 11AB of the Act. Show cause notice also proposed penalty on the appellant under Rule 210 of the erstwhile Central Excise Rules, 1944 and under Rule 25 of the Central Excise Rules, 2002. The original authority confirmed the demands of duty and imposed penalties. The first appellate authority upheld the decision of the adjudicating authority and dismissed the appeal filed by the party. Hence the present appeal.

(2.) After hearing both sides, I find that the short question arising in this case can be settled in the light of the Tribunal's decision in Rocket Engineering Corporation Ltd. v. CCE : 2006 (193) ELT 33 (Tri -Mum) as affirmed by the Hon'ble High Court in Commissioner v. Rocket Engineering Corporation Ltd. : 2008 (223) ELT 347 (Bom). The Hon'ble High, in the cited case, framed two substantial questions of law as follows:

(3.) It appears from the impugned order that the High Court's judgment in Rocket Engineering Corporation Ltd's case was relied upon by the appellant before the lower appellate authority but that authority did not apply its mind to the cited case law. Had it applied its mind, the result would, perhaps, have been different.