TMI Blog2012 (8) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... 198/2011 - Dated:- 8-3-2011 - S/Shri M.V. Ravindran, P. Karthikeyan, JJ. REPRESENTED BY : Shri G. Shiva Dass, Advocate, for the Appellant. Shri D.P. Nagendra Kumar, JCDR, for the Respondent. [Order per : P. Karthikeyan, Member (T)]. This appeal filed by M/s. Alumayer India Pvt. Ltd. (AIPL for short), Nerul, Navi Mumbai, seeks to vacate an order of the Commissioner (Appeals), which sustained demand of Excise Duty of Rs. 32,87,524/-, Education Cess of Rs. 65,750/-, applicable interest demanded under Section 11AB of the Central Excise Act, 1944 (the Act), equal amount of penalty as the duty demanded imposed under Section 11AC of the Act and another penalty of Rs. 25,000/- imposed on AIPL under Rule 25 of the Central Excise Rules, 2002 (CER). 2. AIPL are the manufacturers of structural glazing and aluminium joinery, doors and windows, sun breaker system, louvers, curtain wall, glazing, suspended glass, spider glazing, aluminium composite panel cladding, bridge and staircase cladding, skylight structures such as roofs and roofing frame work, balustrades, hand railing for view bridge, aluminium composite panel cladding for pillars and columns, aluminium composite p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l frame was used in hanging/installing the glasses. They submitted that all activities in question undertaken by the assessee could not be treated as processes amounting to manufacture . Cutting, drilling, punching did not bring about any change whatsoever in the sections/angles/ profiles of aluminium. Even after drilling and cutting, they continued to remain as aluminium sections/profiles/angles only. Only the size of the aluminium pieces changed. No new commodity with a different name, character and use emerged. It was well settled law that drilling/cutting of angles/sections/profiles did not amount to manufacture as they did not bring about any change in the raw material. 2.2 It was further submitted that they had manufactured only aluminium structurals. Hence, in respect of bought out items supplied, such as glasses, panels, fasteners etc., no duty could be demanded from them. Further, installation, commissioning charges, design, engineering charges, and labour charges would not form part of the value of the aluminium angles supplied. Therefore, the amount collected from the customers towards design, engineering charges, erection commissioning charges, labour charges and c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the Commissioner (Appeals) sustained the finding of manufacture and the classification made by the original authority. He found that the OIO was in line with the ratio of the Larger Bench of the Tribunal in the case of Mahindra Mahindra Ltd. v. CCE, Aurangabad, Chandigarh, Kanpur Chennai [2005 (190) E.L.T. 301 (Tri.-LB)]. He reproduced the following paragraph from the said decision as relevant to the case. ....The iron and steel raw material such as angles, plates, tubes etc., are used in making parts of structures and acquired a distinctly different shape to suite structural designs. For example, if iron or steel angles and plates are cut to make a steel table or chair which can be dismantled, it cannot be said that there are no goods manufactured because the iron and steel angles or plates remain such angles and plates though of different sizes and merely holes are punched and screws fitted. Unlike in liquid mixtures, the raw material of iron and steel or wood will retain their identity, but it is precisely their being cut, and designed, punched and fitted to make an article commercially known that involves manufacture of an article distinct from angles, sheets, tubes e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. Others v. CCE, Hyderabad - 2009 (249) E.L.T. 577 (Tribunal) = 2009 (94) RLT 776 (CESTAT-Bang.) (g) M/s. Bosch Ltd. v. CCE, Bangalore - 2009-TIOL-2092- CESTAT-Bang. = 2010 (250) E.L.T. 273 (Tri.-Bang.) (III) As regards quantification, it was submitted that there was a dispute between the assessee and M/s. RMZ and that the assessee had written off the amount as per contract in excess of Rs. 1,72,47,482/-. Going by the case of the Department, the appellants had manufactured only aluminium structurals. Hence, in respect of bought out items supplied, such as glasses, panels, fasteners etc. no duty could be demanded from the appellants. Further, installation, commissioning charges, design, engineering charges, and labour charges also would not form part of the value of the aluminium angles supplied. Therefore, the amount collected from the customers towards design, engineering charges, erection commissioning charges, labour charges, charges for supply of bought out items should be deducted from the total contract price to arrive at the assessable value. In this regard, the appellants relied on the decision in the case of CCE v. Milestone Aluminium Co. Pvt. Ltd. reported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the cost of bought out items. This was based on the work sheet filed by the department before the Tribunal. 6. In the written submissions filed on 4-2-2011, the learned JCDR has reiterated the findings of the original authority and the Commissioner (Appeals) and made the following submissions in support of the impugned order. 7. The assessee s submission that it had discharged duty in the case of unitized structural glazing was a new submission before the Tribunal and the adjudicating authority had no occasion to examine this crucial fact, which had a bearing on the dispute in view of the various case-laws relied upon by the appellant. It is submitted that even in the semi-unitized system, parts of structure emerged were liable to duty under Tariff Heading 76.10. 7.1 It is submitted that both the decisions of the Tribunal in AGV Alfab Ltd. v. CCE, Delhi-II [2005 (186) E.L.T. 451 (Tri.-Del.)] and M/s. Architecture Inc. [2005 (180) E.L.T. 166] cited by the assessee were no longer good law in view of the Larger Bench decision of the Tribunal in the case of Mahindra Mahindra (supra). 7.2 The learned JCDR has excerpted parts of the above judgment in support of the impugned or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of suppression of manufacture of generating sets by the appellant therein as other Central Excise Collectorates had clarified in subsequent Trade Notices that such generating sets assembled at site were dutiable and they were superficially attached or bolted to ground. Thus, they were not immovable property and there was no doubt of dutiability of generating sets. The assessee was required to disclose manufacture of generating sets to the department. 8. We have carefully studied the case records and the submissions by both sides. The dispute involved is whether the aluminium sections forming structurals fabricated prior to erection of windows and structural glazing falling under CSH 76.10 of the Central Excise Tariff are manufactured goods liable to excise duty. If so, if the demand confirmed against the assessee invoking longer period has been validly made. There are also questions of the correctness of the quantification of duty liability and the penal liability of the assessee. During hearing, the learned counsel for the appellants had explained unitized glazing system and semi-unitized glazing system. In the unitized glazing system, the panel fabrication and fixing of the gla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in raising the structure come into existence through fabrication as per the pre-determined design to be fitted into the structure that is to be raised. For example, roof frame may be fabricated for the roof structure of a shed. Such fabrication of frames may be done at the construction site or at some factory premises. The iron and steel frames fabricated at the factory premises away from the site of construction would be brought to the site for their use in erecting the structure. The frames pre-fabricated and brought at the site and frames fabricated the site of erection both are goods manufactured. There will be variety of parts of structures of iron and steel, that can be fabricated either at the site or at some factory premises away from the site. The iron and steel raw material, such as angles, plates, tubes, etc., are used in making parts of structures and they acquire a distinctly different shape to suit the structural designs. For example, if iron or steel angles and plates are cut to make a steel table or chair which can be dismantled, it cannot be said that there are no goods manufactured because the iron and steel angles or plates remain such angles and plates thou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a factory. When the required parts are fabricated they will be fixed as per the designed structure and will continue to be moveable object until made immovable by permanently fixing them in the designed immovable structure. To say that no parts of the structures came into existence as distinct commodities because ultimately they got permanently fixed into an immovable structure will run counter to the legislative intent to impose excise duty on such excisable goods at a stage when they have a separate identity as marketable goods anterior to their being permanently fixed in the immovable structure. 10. Chapter Sub-heading 76.10 reads as follows : 76.10 : Aluminium structures (excluding pre-fabricated buildings of heading No. 94.06) and parts of structures (for example, bridges, and bridge-sections, towers, lattice masts, roofs, roofing frameworks, doors and windows and their frames and thresholds for doors, balustrades, pillars and columns); aluminium plates, rods, profiles, tubes and the like, prepared for use in structures. 11. Heading 73.08 reads similarly and is reproduced below : 73.08 : Structures (excluding pre-fabricated buildings of heading No. 94.06) and p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d goods and therefore, not exigible. In this connection, we note that a constitution bench of the Supreme Court, in CCE, Jaipur v. Man Structurals Ltd. [2001 (130) E.L.T. 401 (S.C.)] had made the following observations:- 5. In the judgment and order of the Tribunal that is under challenge the Tribunal has failed to consider the facts of even a single of the appeals before it. It has proceeded simply upon the basis that structurals are not exigible to excise duty. It has failed to appreciate that there is a tariff entry which makes structurals exigible to excise duty and that they are so exigible, provided that they are new identifiable goods that are the result of manufacture or processes and they are marketable. 16. As the assessee has been following judicial pronouncements to decide if the impugned goods were liable to excise duty, this particular judgment could not have escaped its notice. From this judgment, it is obvious that the impugned goods viz. aluminium structurals are covered by a tariff entry and would be exigible if they are identifiable goods. We cannot hold that the assessee would have required the exposition of relevant law in the Mahindra Mahindra case to ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
