CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI PRINCIPAL BENCH, COURT NO. I EXCISE APPEAL NO. 53710 OF 2018 [Arising out of the Order-in-Original No. ALW-EXCUS-000-COM-020-18- 19 dated 24/08/2018 passed by The Commissioner of Central Excise, Alwar]

M/S KUNSONS METALS LTD. ……APPELLANT (now called Balar Marketing Private Limited)

G-I,472, Phase-I, RIICO Industrial Area Bhiwadi, District Alwar Rajasthan – 110 035 Versus COMMISSIONER OF CENTRAL EXCISE ….RESPONDENT A-Block, Surya Nagar Alwar, Rajasthan– 301001 APPEARANCE:

Shri B.L.Narasimhan and Ms. Sukriti Das, Advocates for the appellant.

Shri Rakesh Agarwal, Authorized Representative for the Department CORAM:

HON’BLE JUSTICE MR. DILIP GUPTA, PRESIDENT HON’BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)

FINAL ORDER NO. 50174/2026 DATE OF HEARING : 21.11.2025 DATE OF DECISION: 27.01.2026 P.V.SUBBA RAO We have heard Shri B.L. Narasimhan, learned counsel for the appellant and Shri Rakesh Agarwal, learned authorized representative for the Revenue and perused the records.

2. The facts which led to the issue of the impugned order are that the appellant manufactured goods on job work basis during the period 2008-09 to 2011-12 but had not paid any central excise duty. Goods manufactured on job work basis were exempted from payment of central excise duty during the relevant period under conditional exemption notification no.

214/86 and the condition being that the Principal undertakes to pay the central excise duty. No such undertaking was given by the Principal and hence the appellant was bound to, but had not, paid central excise duty.

3. Accordingly, a Show Cause Notice was issued to the appellant and thereafter an order dated 7.1.2014 was passed confirming demand of central excise duty of Rs.2,37,08,329/- under section 11A(4) along with interest and an equal amount of penalty was imposed under section 11AC on the appellant. Penalty of Rs. 25,00,000/- was also imposed on Shri Vimal Jain, Director of the appellant.

4. Both the appellant and Shri Vimal Jain had appealed to this Tribunal and Final Order No. 57388-57389/2017 dated 26.1.2017 allowed the appeal of Shri Vimal Jain and remanded the matter to the original authority as follows:

a) The confirmation of demand with interest was upheld invoking extended period of limitation;

b) The appellant was held entitled to CENVAT Credit on inputs and input services on satisfactory verification by the jurisdictional officer;

c) Cum duty benefit was allowed;

d) It was held that the amount of penalty also needs to be re-

determined after re-determining the duty payable; and e) The matter was remanded to the Commissioner for calculation as above.

5. Thereafter, the Commissioner passed the impugned order:

a) Holding that the appellant was entitled to CENVAT credit of Rs. 1,99,62,470/- on the inputs and input services;

b) Disallowing CENVAT credit on capital goods amounting to Rs. 2,86,134/- on the ground that this Tribunal had, while remanding the matter did not allow CENVAT credit on capital goods;

c) Re-quantified the amount of duty considering the cum-duty benefit to Rs. 2,09,22,155/- from Rs 2,37,08,329/-; and d) Imposing penalty of Rs. 2,09,22,155/- under section 11AC.

6. The submission of the learned counsel for the appellant is that the Commissioner has erred in not allowing CENVAT Credit on capital goods and also in imposing penalty under section 11AC without considering the CENVAT credit available to the appellant. 7. Learned authorized representative for the Revenue vehemently supported the impugned order.

8. We have considered the submissions advanced by both sides and perused the records.

9. As far as the CENVAT credit on capital goods is concerned, both sides agree that the only reason this was not allowed is because in the remand order, while this Tribunal allowed CENVAT credit on inputs and input services but had not mentioned about CENVAT credit on capital goods.

10. After going through the order of this Tribunal remanding the matter and the impug