TMI Blog2013 (9) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of demand of duty on them was not the legal - No process was being undertaken by the appellant either at their godown or at their factory - It was a case of simpliciter providing of all the components of the wheel aligner to the workshop and to assist the workshop people to use the same by digging a pit and connecting the various items in their premises - The goods were only cleared under one invoice - the goods were not even brought to the factory and were cleared from the godown itself or sometimes directly from the vendor’s premises - The duty was accordingly, set aside along with setting aside of confirmation of interest and penalty imposed upon them. NARNE TULAMAN MANUFACTURERS PVT. LTD. Versus COLLECTOR OF C.E. [1988 (9) TMI 51 - SUPREME COURT OF INDIA] - no new and commercially different commodity, having different name character and use emerges, so as to hold the activity as amounting to manufacture and liable to duty - by making a distinction between manufacturing and packing, it was held that activity undertaken by the appellant was one of packing and not manufacturing. Extended Period - The demand was also hit by bar of limitation - The demand stands confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11AC of the Central Excise Act, 1944 read with Rule 25 of Central Excise Rules, 2002. Penalty of Rs. 10 Lakhs each stands imposed on Shri M.S. Shah, Director and Shri H.C. Shah, authorized signatory, in terms of Rule 209A of Central Excise Rules, 1944. 3. As per the undisputed facts on record, the appellants are buying following equipments from the market and temporarily storing in their godown situated away from their factory premises :- (a) Personal Computer (PC) loaded with appropriate software with Dot-matrix Printer. (b) Two turn tables. (c) Two sensor holders. (d) Two sensors with cable. (e) Trolley to keep the computer. 4. The above goods are dispatched from the godown itself to the various workshops under the cover of a single invoice. Sometimes, these goods are directly dispatched to the customers from the vendors itself. 5. During the course of investigation, the Revenue recorded statements of Shri Hemant C. Shah as also Shri Sanjay Pravin Kumar Ramali, Engineer and Shri M.S. Shah, Director of the unit. They all deposed that on receipt of order for Computerized Wheel Aligner, ML 3000CC, their engineer visits the site with a pit diagram for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Block Diagram of Wheel Alignment Computer At this stage, we take note of certificate given by Chartered Engineer. For better understanding of the activities undertaken by the appellants, we reproduce the said certificate :- TO WHOMSOEVER IT MAY CONCERN This is to certify that on request of M/s. Neptune Equipment Pvt. Limited, 407 GIDC Estate, Odhav, Ahmedabad, the undersigned had visited one of the workshops at Ahmedabad and inspected the Wheel Alignment of vehicle, on 19th of Nov. 2002. My observations are as under :- The Wheel Alignment Computer consisting of the following. (1) Personal Computer (PC) loaded with appropriate software with a Dot Matrix Printer (2) Turn Table (3) Sensor Holders (4) Sensor with Cable (5) Trolley to keep the computer The method of use : The computer kept on trolley stands in one corner of the workshop. When a vehicle comes for wheel alignment check, the front two wheels or the rear two wheels of the vehicle as the case may be, are parked on the turn table with the help of jack so as to provide easy movement of the wheels. The Sensor Holders are attached to both the front wheels ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the use of the same in the customer s premises for checking the alignment of a vehicle would amount to manufacturing activities on the part of the appellant or not. As is seen from the certificate, all the five items required for wheel aligner are brought together in the customer s premises only for checking the vehicle. As soon as the job is done, all the components i.e. sensor, sensor holder, turn table etc. are removed from the vehicle and put back into the corner of the workshop. As per the said certificate, the items are kept loosely and individually, inasmuch as they have independent roles to play. They come together only at the time of use at the customer s workshop. 10. The Commissioner has framed the following issues :- (i) Whether there is any product known in the market as Computerized Wheel Aligner? (ii) Whether the noticee is undertaking any process which amounts to manufacture under the provisions of Section 2(f) of the Central Excise Act, 1944? (iii) Whether the equipment, Computerized Wheel Aligner is chargeable to duty? (iv) Whether the extended period is invokable in the facts and circumstances of the case? (v) Whether the noticees are liab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tered Engineer certificate that such connections are temporary and after the job is done, they are taken out and kept individually in the corner of the workshop. The same are again reconnected at the time of the second job. Merely because the appellants were responsible for warranty and after sale services, by itself cannot be held to be a reason for holding the activities of the appellants as amounting to manufacture. 14. We find that the Tribunal had earlier remanded the matter to Commissioner for de novo adjudication in the light of the law declared by the Andhra Pradesh High Court in the case of XI Telecom Limited, the Hon ble High Court has taken note of the test laid down by the Hon ble Supreme Court in the all time famous case of DCM and has observed that every change does not necessarily fall within the expression manufacture unless it is shown that the process has brought into existence any new product having a distinct identity in the commercial world. As such the Hon ble Court in Para 12 observed as under :- 12. What emerges from the above is excise duty is leviable on goods manufactured. The expression manufacture means bringing into existence a new substance an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r tests have not been satisfied. Therefore, placing different articles in the kit does not amount to manufacture. If once the activity of placing the articles in the kit does not amount to manufacture, the provisions of the Act are not applicable as the levy of excise duty is on the production and manufacture of goods. As is seen from the above, that placing of all the items in one kit, which has a distinct name as Cable Jointing Kit, was held to be a non-manufacturing activity on the part of appellant. The ratio of the above decision can be squarely applied to the facts of the instant case. In fact, the present case stands on a better footing inasmuch as the appellants are not doing anything to the various items purchased by them, which are being cleared as such by them to their customers. Except that all the items are being cleared under one name as Computerized Wheel Aligner, in the commercial invoice being raised by them. As such, we are of the view that buying and selling of various parts of wheel aligner, without undertaking any process thereon, would not amount to the appellants undertaking any manufacturing activities so as to invite duty confirmation. 15. At this st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... them is not the legal. The same is accordingly, set aside along with setting aside of confirmation of interest and penalty imposed upon them. 17. At this stage, we may also take note of another contention raised by the appellant on the ground that duty liability has to be addressed in the condition at which the goods were removed from the factory. For the above proposition, reference has been made to various decisions. Particularly in the case of Punjab Breweries Limited, Ludhiana v. CCE, Chandigarh - 1985 (22) E.L.T. 513 (Tri.) and in the case of Collector of Central Excise, Indore v. Parmali Wallace Limited - 1985 (21) E.L.T. 231 (Tri.). As such it stands contended that admittedly the goods which left their factory were bought out items without any further process done upon the same, they cannot be held to be Computerized Wheel Aligner. We note that the said fact also stands admitted by the adjudicating authority. No activity is admittedly done by the appellants in their factory. The goods were also not packed in one pack unlike the two cases referred supra. The goods are only cleared under one invoice. Further, the goods are not even brought to the factory and are cleared fro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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