HINDUSTAN LEVER LIMITED AND SNEH Vs. CCE

JUDGEMENT

(1.) ALL these appeals are directed against the Order -in -Appeal wherein imposition of penalty on the appellants is upheld.

(2.) THE relevant facts arising for consideration are that M/s. Sneh Silicate the appellants in appeal No. E/127/04 is a job worker of M/s. Hindustan Lever Ltd. and appellant in Appeal No. E/125/04 and E/126/04. M/s. Hindustan Lever Limited used to get the goods Sodium Silicate manufactured on job work basis from M/s. Sneh Silicate. The inputs like Soda Ash and Silicate etc. was directly delivered to the premises of the job worker and part of inputs was delivered by M/s. Hindustan Lever Limited on job work challan. M/s. Sneh Silicate, the job worker took the credit of the inputs received directly by them and also consumed some of inputs procured by themselves for manufacture of Sodium Silicate . The said goods, Sodium Silicate was cleared by M/s. Sneh Silicate on payment of appropriate duty. The valuation is not challenged by the department. The Revenue issued a show cause notice to both the appellants for illegal availment of credit of Modvat on the inputs. The adjudicating authority, confirmed the demand on both the appellants and also imposed penalty. On appeal, the Commissioner (Appeals), come to the conclusion that the duty paid by the jobworker is correct as also availment of Modvat Credit by him cannot be faulted and that M/s. Hindustan Lever Limited has availed the credit of duty correctly as duty has been discharged by the job -worker and set aside the demand but reduced the penalty for violation of procedure prescribed under the law.

(3.) THE learned Advocate for the appellant submits that the appellate authority has erred in upholding the part of the penalty, and that there is no violation of any procedure. He submits that the M/s. Hindustan Lever Limited has followed the correct procedure by clearing the inputs under job work challan, as they had availed Modvat Credit on those inputs. Availment of Credit of the duty paid inputs has been correctly upheld by the Commissioner (Appeals) and penalty should have also been set aside by him.