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2015 (11) TMI 362 - CESTAT NEW DELHI

2015 (11) TMI 362 - CESTAT NEW DELHI - TMI - Denial of refund claim - Automobile cess - whether the appellant being job worker i.e. manufacturer of body building is required to pay automobile cess or not as per Automobile Cess Rules, 1984 read with Industries (Development and Regulation) Act, 1951 or not - Held that:- Matter of levy of automobile cess was referred to Administrative Ministry i.e. Ministry of Industries and as intimated the intention behind the notification levying the cess is to .....

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ase the body on the chassis is built by an independent body builder on the cess paid chassis. Therefore, there was no intention of the Administrative Ministry to levy cess on the activity of the body building. In that case, although the appellant may be the manufacturer in the light of the Chapter Note 5 of the Chapter 87 of the Central Excise Act, 1985, the automobile cess cannot be levied or collected from the appellant. - automobile cess cannot be demanded from the appellant. Therefore, the d .....

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ts of the case are that the appellant is engaged in the manufacture of basis/fabrication of bus bodies on duty paid chassis supplied by M/s. Eicher Motors and others. The appellant was paying automobile cess on the body building manufacture till 2005 but stopped paying automobile cess thereafter on the insistence of chassis suppliers, who had already paid automobile cess on the value of the chassis in terms of CBEC Circular No.48/88 dated 31.08.88. The appellant filed refund claims before the De .....

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how cause notice were confirmed along with interest by the adjudicating authority and penalties were dropped. Against the said order, both the sides filed appeals before the Commissioner (Appeals), the department against dropping the penalty by the adjudicating authority and the appellant against the order of demanding automobile cess from the appellant. The ld. Commissioner (Appeals) confirmed the demand along with interest and also imposed penalty on the appellant. Aggrieved from the said orde .....

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s relied on the CBEC Circular No.41/88 dated 31.08.1988 but the same is not applicable to the facts of this case as in this case, the automobile cess was sought to be demanded from the appellant after introduction of Chapter Note 5 of Chapter Note 87 of the Central Excise Tariff Act, 1985. As per Chapter Note 5 of Chapter Note 87 of CETA, the activity of the body building amounts to manufacture. Therefore, the Circular dated 31.08.1988 has lost its relevance and the Chapter Note 5 of Chapter 87 .....

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of Central Excise Act, 1944. Therefore, the appellants are the manufacturer of the automobiles as per Chapter Note-5 of the Chapter Note 87 of CETA and as per the Automobiles Cess Rules, 1984, the manufacturers of automobiles are required to pay cess. In that sense, the appellant are required to pay automobile cess on their activity and the CBEC's Circular has no relevance to that. In these circumstances, the impugned orders are to be upheld. 5. Heard the parties. Considered the submissions. .....

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endent body builder Subject:- Levy of Cess on automobiles consequent upon the introduction of new Central Excise Tariff, 1985 -Clarification regarding. Doubts have been raised as to whether with the introduction of new Central Excise Tariff, 1985 w.e.f. 28.02.1986, cess is required to be levied once again on the body built motor vehicles even when cess has already been paid on the chassis manufactured by the independent body builder. The matter has been referred to Administrative Ministry who ha .....

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the IDR Act. Therefore, the cess may continue to be levied and collected on the vehicles in the condition they are cleared from the premises of the manufacturers and no cess should be levied again in case the body on the chassis is built by an independent body builder on the cess paid chassis. The cess should be levied and collected accordingly. Trade interests should also be suitably informed." 7. On introducing the said Circular, we find that the matter of levy of automobile cess was ref .....

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to be levied and collected in the condition they are cleared from the premises of the manufacturers and no cess should be levied again in case the body on the chassis is built by an independent body builder on the cess paid chassis. Therefore, there was no intention of the Administrative Ministry to levy cess on the activity of the body building. In that case, although the appellant may be the manufacturer in the light of the Chapter Note 5 of the Chapter 87 of the Central Excise Act, 1985, the .....

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