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2024 (5) TMI 1047 - CESTAT BANGALOREProcess amounting to manufacture or not - assembling of various parts and components of furniture imported in CKD condition and also procured indigenously, at the premises of the appellant or at the site of the customers - Furniture classifiable under CSH 9403 of CETA,1985, within the meaning of Section 2(f) of Central Excise Act, 1944 or not - extended period of limitation - imposition of penalties on the Appellant and the Director - Cum-tax value & Cenvat credit is admissible if the process of assembly of furnitures is held to be excisable or not. Excisability - HELD THAT:- On the facts whether the workstations installed at the site of the customers become immovable, hence not excisable, the Ld. Commissioner analysing the statements furnished by the Manager and the Supervisor of the appellant and the cross examination of the said witnesses and other evidence has categorically held that with minor damages and scratches, the workstations installed in the premises of the customer from the imported and indigenously procured parts and components could easily be shifted to other premises, hence, these furniture(work stations) are movable and accordingly excisable - the statements/depositions given by the witnesses before the Department have not been retracted, hence are reliable evidences. The witnesses also cross examined before the adjudicating authority. No contrary evidence has been placed by the Appellant to support their argument that after assembling and then fixing the workstations to the ground / floor at the customers’ premises, it becomes immovable; hence not excisable. This Tribunal also in the case of Leo Circuit Boards Pvt. Ltd. [2015 (5) TMI 659 - CESTAT MUMBAI] more or less confronted with more or less a similar issue of excisability of assembly of Lottery Terminal out of CKD kit supplied by M/s. Pan India Network Infravest P. Ltd. By referring to the list of parts that have been assembled at the site of the customers, even though fully manufactured and cleared in CKD condition by the supplier and later assembled at the site, this Tribunal came to the conclusion that such assembly of different parts brought in CKD condition to bring into existence of Lottery Terminal, would result into ‘manufacture’. Classification of goods - HELD THAT:- In the present case, undisputedly the entire parts and components of the furniture, workstations are not imported but certain indigenous parts and components are procured are also used in assembling the parts/ components of furnitures imported in CKD condition - assembly of parts and components of the furniture i.e. workstations in the premises of the customers would result into manufacture of excisable goods viz. ‘furniture’ classifiable under CTH 9403 and attracts duty. Invocation of extended period of limitation - HELD THAT:- There is merit in the argument of the appellant that on a bona fide belief that excise duty on assembly of furnitures at the site of the customers will not be payable as customs duty has already been paid at the time of its import in CKD condition albeit certain parts used were procured indigenously, excise duty was not discharged on assembly of the same - The judgment of the Hon’ble Supreme Court in Craft Interiors Pvt. Ltd.’s case [2006 (10) TMI 2 - SUPREME COURT] was delivered in the year 2006 and the present demand is confirmed invoking suppression of facts for the period 2004 to 2006-07. In these circumstances, confirmation of duty invoking extended period of limitation cannot be sustained. Thus, the demand, by issuing show-cause notices from time to time, should be limited to the normal period of limitation. Penalty - HELD THAT:- There are no substances in imposing penalty on the appellant for failure to discharge service tax on the assembled furniture during the relevant period. Penalty on Director - HELD THAT:- There are no justification for imposition of penalty on the Director. Consequently, the appeals filed by the Director are allowed. Cum-duty benefit - CENVAT Credit - HELD THAT:- In the event, the appellant had issued proper invoices indicating sale price of the goods and genuineness of which has not been disputed, the appellants are eligible for the benefit of cum-duty price in view of the amendment to Section 4 of the Central Excise Act, 1944 w.e.f. 14.05.2003 - Also, the appellants are entitled to avail cenvat credit on the inputs on production of evidences of payment of duty on the said inputs to the satisfaction of the adjudicating authority. The impugned orders are modified and the cases are remanded to the adjudicating authority to compute the demands with interest for the normal period of limitation only; also the benefit of cum-duty price and cenvat credit be allowed subject to production of necessary documents. As observed above, no penalty is imposable. Appeal disposed off.
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