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2016 (10) TMI 473 - CESTAT CHANDIGARH

2016 (10) TMI 473 - CESTAT CHANDIGARH - TMI - Demand of duty with interest and penalties - construction equipments - Whether the parts of WTLB and Hydra Cranes are liable for duty prior to 29.04.2010 being covered under ‘automobiles’ or not? - Held that: - the expression ‘automobiles’ has not been defined in the Central Excise Act. Therefore, it is not permissible to adopt the definition of very same expression appearing in another different enactment. - The case referred CCE, Pune-I vs JCB .....

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of the expression ‘automobiles’ can be assigned from the uniformally defined in the various dictionaries and known in common parlance? - Another matter which needs consideration is the Notification No.11/2011 dated 24.03.2011 giving the effect of demand of duty w.e.f. 29.04.2010 on the parts, components and assemblies of goods falling under Tariff Item No.8426 41 00, headings 8417, 8429 and sub heading 8430.10 is clarificatory and applicable prior to 29.04.2010 or mandatory and applicable .....

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are as under : 1.1 The Appellants are manufacturers of construction equipment viz. Wheeled Tractor Loader Backhoe (WTLB), Hydra Cranes, Forklifts, tractors, etc. chargeable to central excise duty. The WTLB and Hydra Crane are self propelled type. Besides this, they also trade in spare parts of WTLB, Hydra Cranes, and tractors from separate warehouses outside the factory where the duty paid parts of these machines are stored and are sold after re-packing. The is one spare parts Division for Trac .....

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31, which covers parts suitable for use solely or principally with the machinery of heading no.8425 to 8430 . The period of dispute in this case is from June, 2006 to June, 2010. Section 2 (f)(iii) of the Central Excise Act, 1944, states that in respect of the good listed in Schedule III to the Central Excise Act, 1944, packing or re-packing of goods in a unit container, or labelling or relabelling of containers including declaration or alteration of retail sale price on its or adoption of any o .....

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Sl. No.100 covers parts, components and assemblies of vehicles (including chassis fitted with engine) falling under Chapter 87 excluding the vehicles falling under Heading no. 8712,8713,8715 and 8716 , the Sl.No.100 A covers parts, components and assemblies of goods falling under heading Tariff Item No.84264100 , 8427, 8429and the sub-heading 843010 . The dispute in this case is as to whether during the period of dispute, there repacking of the goods - parts of WTLB Hydra crane for their retail .....

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s, components and assemblies of automobiles and their packing or repacking for their retail sale would amount to manufacture. On this basis, a show cause notice dated 4.1.2011 was issued to the appellant company for demand of allegedly no-paid duty amounting to ₹ 6,07,44,253/- along with interest thereon and also for imposition of penalty on the Appellant. Company under Section 11 AC and Penalty on Shri Vijay Agarwal, CMD and Shri P.K. Bansal, CFO under Rule 26 of the Central Excise Rule, .....

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pose of MRP based assessment, which is identical to entry no. 100 of the 3rd Schedule to Central Excise Act, 1944, as it stood during period prior to 29.4.10, the Board had clarified that to interpret the term automobile , the definition of this term as given in Automobile Cess rules, may be adopt4ed. In circular dated 11.07.90, the Board had clarified that Hydraulic excavator are not automobile . However, this plea of the appellant was not accepted by the Commissioner, who vide order-in-origina .....

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Crore and ₹ 50 Lakhs on Shri Vijay Aggarwal and Shri P.K. Bansal respectively under Rule 6(1) of the Central Excise rule, 2002. 2. Shri B.L. Narshimhan, learned Counsel for the appellants pleaded that there is no dispute about the fact that WTLB, and Hydra Crane are construction machinery classifiable under heading 8429 and 8426 respectively and their parts are classifiable under heading 84.31, that in terms of the Board s circular dated 16.12.2008 for the purpose of entry no. 97 in Notifi .....

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assemblies of Automobiles , that the clarification issued by the Board is binding on the department, that the term Automobile appearing in Sl.No.100 of the third Schedule to the Central Excise Tariff Act, 1944 should be interpreted in the context of the Central Excise Tariff and not on the basis of definition of this term in Motor Vehicle Act, 1988 or Air (Prevention and Pollution) Act 1981, that when components of Hydra crane and WTLB are classifiable under heading 84.31 as construction machine .....

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rstood in the sense in which the people conversation with the subject matter of the statute understand it and it is hazardous to interpret such word in accordance with its definition in another statute or statutory instrument, more so, where the stature or statutory instrument is not dealing with the cognate subject, that in view of this judgement of the Apex Court, the definition of Automobile in Motor Vehicle Act, 1988 or in Air (Prevention & Control of Pollution) Act, 198, which do not de .....

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and assemblies of the goods falling under Tariff Item No.84264100, 8427,8429 and 843010 , that this amendment, in absence of any specific provision regarding its retrospective applicability, is inapplicable for the period prior to 29.04.2010. that from this amendment also, it is clear that during the period prior to 29.04.2010, the term parts, components and assemblies of Automobiles would not cover the parts, components and assemblies of earth moving/construction machinery falling under Heading .....

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ng as to why Cenvat Credit would not be available, that in any case, the appellant s duty liability in respect of clearance of part of WTLB and Hydra Crane during the period prior to 29.04.2010 after permitting the Cenvat Credit would be substantially less than the amount confirmed, that the bulk of the duty demand pertains to the period to 29.04.2010 while the appellant have already paid and amount of ₹ 50,68,909/- pertaining to the period from 29.04.2010 to June, 2010, that no penalty is .....

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and accordingly the same are to be dismissed. 4. Heard the parties and considered the submissions. On careful consideration of the submissions made by both sides, we find that the issue arises from the arguments is that : Whether the parts of WTLB and Hydra Cranes are liable for duty prior to 29.04.2010 being covered under automobiles or not? 5. We have seen that as per 3rd Schedule of Central Excise Act, 1944 the activity of re-packing was deemed to be manufacture entered at Serial No. 100 for .....

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al in the case of JCB India Ltd. (supra) wherein this Tribunal observed as under : 17.1 We have considered the rival submissions, and given considerable thought to these submissions. At the outset we note that all the items in question viz. Loader, Backhoe Loader and Road roller are self-propelled, work with internal combustion engine using fuel such as diesel, have four wheels and are rubber tyred (road roller may have two rubber tyres and one roller, or only rollers). These can move on roads l .....

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ads, motors Vehicles Act requires the vehicles to be examined/tested by specified institutions regarding suitability to ply on road, etc. and based upon the appropriate certification, motor vehicles are allowed on the road and registration under Motor Vehicles Act is granted thereafter only. In the present case, appellant had approached the Automotive Research Association of India, Pune who after examination has granted the requisite certificate. A perusal of the application and certificate indi .....

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ackhoe Loaders & road rollers as motor vehicle, whether parts, components and assemblies of three items are parts, components and assemblies of automobile. 18.2 The word automobile is not defined is the Central Excise Act or Central Excise Tariff Act. Ld. Senior Advocate respondent have quoted meaning of the said term from various dictionaries. From the said meaning, it appears that word is used for what is popularly understood as car. Some dictionaries extend it to vehicles carrying small q .....

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ne or by any method of generating power to drive such vehicle by burning fuel. In our view this definition though in different Act with different purpose will be nearer to the normal understanding of the term as on day. It may be true that concept of automobile started with car, which was thereafter technologically advanced to buses, trucks, scooters, motorcycle, moped and then various special purpose vehicle such as fire tender, ambulance, as also agricultural tractors, construction equipment v .....

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4. The expression industry has many meanings. It means skill , Ingenuity , dexterity , diligence , systematic word or labour , habitual employment in the productive arts , manufacturing establishment etc. but while construing a word which occurs in a statute or a statutory instrument in the absence of any definition in that very document it must be given the same meaning which it receives in ordinary parlance or understood in the sense in which people conversant with the subject matter of the s .....

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required to limit a word to an unnatural sense because in some Act which is not incorporated or referred to such an interpretation is given to it for the purposes of that Act alone Macbeth v. Chislett - (1910) A.C. 220,223. Admittedly, the expression automobiles has not defined in the Central Excise Act. Therefore, it is not permissible to adopt the definition of very same expression appearing in another different enactment. We also take of the fact that it is settled position when an expression .....

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produced. However, dictionary gives more than one meaning of the word produce. Neither the word produce nor the word article has been defined in the Act. When the word is not so defined in the Act it may be permissible to refer to dictionary to find out the meaning of that word as it is understood in the common parlance. But where the dictionary gives divergent or more than one meaning of a word, in that case it is not safe to construe that said word according to the suggested dictionary meaning .....

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the context. Thus, when the word read in the context conveys a meaning, that meaning would be the appropriate meaning of that word and in that case we need not rely upon the dictionary meaning of that word. 7. We have seen the dictionary meaning in the various dictionaries, namely, The chambers Dictionary gives the meaning of automobiles as a motor car ; The American Heritage Dictionary gives the meaning of automobiles as a self propelled passenger vehicle. Further, the Cambridge International D .....

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of automobiles when various dictionaries have given the uniform meaning of the expression automobiles as passenger car or goods carrier . In these circumstances, we are not in agreement with the said decision of this Tribunal on this issue. 9. Further, the contention of the appellants is that, there was an amendment in 3rd Schedule of the Central Excise Act, 1944 by finance Act, 2011 through Notification No. 11/2011 Dated 24.03.2011 giving effect of demand of duty w.e.f. 29.04.2010 on the parts .....

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nd 8716 were notified under section 4A of the Central Excise Act with effect from 27.02.2010. Subsequently, parts, components and assemblies of certain vehicles falling under chapter 84 were also notified under these provisions with effect from 29.04.2010. However, these goods were not simultaneously included in the Third Schedule to the CETA. These are now being included in the Third Schedule retrospectively w.e.f. 27.02.2010 and 29.04.2010 respectively. The duty is payable on the parts and com .....

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