Failure to Produce Job Work Challans: CESTAT upholds CENVAT Credit Recovery Proceedings [Read Order]

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), upheld the Cenvat Credit recovery proceedings on the ground of failure to produce job work challans.

The appellant, M/s Macneil Engineering Ltd, is a manufacturer of battery anddiesel operated fork lift trucks, platform trucks, hand-pallet stackers, and spare parts thereof falling under Chapter 84,85 & 87 of Central Excise Tariff Act, 1995. Pig Iron is one of the essential ingredients for the manufacture of ingredients and components of the aforesaid products.

The appellants however, have no foundry/furnace for melting of the said pig iron and it is their case that they get their products casted through job work procedure. The pig iron is therefore said to bereceived by the appellants under cover of Central excise invoice, on which CENVAT Credit is availed by them and the said goods sent to M/s Asit Iron Foundry Pvt Ltdfor job work and casting them into desired shapes and sizes, in accordance with the drawings supplied by them which form part/components of the final product manufactured by them.

It is the case of the department that in response to the said Show Cause Notice, the assessee was not able to produce the required evidence in support of their job work claim, in as much as the appellants failed to produce a copy of the requisite intimation/undertaking required to be made to the jurisdictional Assistant/Deputy Commissioner as regards their adherence thereto as set out in job work notification 214/86-CE dated 25.03.1986.

Besides they also failed to produce job work challans and otherrecords/registers evidencing the possession of inputs, as prescribed in terms of notification No. 214/86-CE.

Upholding the Cenvat Credit recovery proceedings the Tribunal of Rajeev Tandon, Member (Technical)observed that “The appellants have not been able to demonstrate the filing of the undertaking as envisaged under notification No. 214/86-CE dated 25.3.86 and their plea of submission of job-work challans later for a part period at the time of hearing before the adjudicating authority, has also been demonstrated as manipulated, deficient/ over written bearing duplicate numbers with deleted/obliterated serial numbers, dates etc. and bearing challan numbers differently hand written in ink.”

To Read the full text of the Order CLICK HERE

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