TMI Blog1987 (6) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 of 1944) and they are specified in the Schedule. Section 3 of the Central Excises and Salt Act is the charging section. It reads as under :- "3. Duties specified in the Schedule to the Central Excise Tariff Act, 19S5 to be levied : (1) There shall be levied and collected in such manner as may be prescribed duties of excise on all excisable goods other than salt which are produced or manufactured in India and a duty on salt manufactured in, or imported by land into, any part of India as, and at the rates, set forth in the Schedule to the Central Excise Tariff Act, 1985." 3. The Act was enforced on February 28, 1986. Entries in Chapter 87 of Section XVII of the Schedule to the Act insofar as they are relevant for the purposes of the present controversy, read as under :- Heading No. Sub-Heading No. Description of goods Rate of duty (1) (2) (3) (4) 87.01 8701.00 Tractors (other than tractors of Heading of 87.09). 15% 87 . 02 8702.00 Puplic transport type passenger motor vehicles 25% 87.03 8703.00 Motor cars and other motor vehicles principally designe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Heading No. 87.07 does not figure in the list of goods made exigible to excise duty. Goods covered by Heading No. 87.07 are, thus, exempt from the levy of excise duty. The bodies (including cabs) for the motor vehicles built by the petitioners are exempt from the payment of excise duty. The respondents are, however, insisting that the petitioners who are engaged in the business of building bodies over the chassis for trucks and buses is liable to pay excise duty at the rate of Rs. 4,000/- and Rs. 8,000/- respectively per body built. The Superintendent, Central Excise, Moga Range, vide letter, dated September 8, 1986 (Annexure P-10) wrote to the President of the Union/Association of body builders of truck/buses that by virtue of the amended notification, dated April 24, 1986, the body builders of trucks and buses had to pay excise duty of Rs. 4,000/- and Rs. 8,000/- per vehicle respectively. A similar letter was written to one of the petitioners on September 16, 1986 Annexure P-5, that since they are manufacturing bodies for trucks and buses, they have to take out a licence under the Central Excise Act and since they had not applied for the issuance of a licence, action will be take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... separate independent unit capable of being sold and purchased, into an entirely different unit. After the fabrication of the body, the chassis becomes a motor vehicle capable of being used for the conveyance of passengers or carriage of goods, as the case may be. It does not remain a chassis. Thus, the manufacturing process of fabrication of body on the chassis partakes the character of manufacture of a motor vehicle, which may be used for purposes of carriage of passengers or movement of goods. The petitioners, therefore, are engaged in manufacturing the motor vehicles as envisaged by Heading Nos. 87.02 and 87.04 and are, thus, liable to pay excise duty on the motor vehicles which come into being after the petitioners' undertaking the manufacturing process. The petitioners, it is contended, are thus liable to take licences also. 8. These submissions of Mr. Brar have not commended themselves to me. The petitioners run small scale units fabricating bodies for trucks and buses on the chassis supplied by the customers. They undertake simple building and fabricating processes. They are not licensed or equipped to manufacture motor vehicles. It is a matter of common knowledge that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they who are concerned with it and it is the sense in which they understand it that constitutes the definitive index of the legislative intention when the statute was enacted. Applying these tests, the bodies build/fabricated by the petitioners on the chassis supplied by the customers cannot be termed to be motor vehicles. The petitioners do not proclaim or give out that they are manufacturing or selling motor vehicles. No person who wants to purchase a motor vehicle will go to the petitioners for this purpose, because the people in the transport business do not associate in their minds the body of the motor vehicle with the need which a motor vehicle supplies in real life. There are more than 500 body builders in the small State of Punjab. Such a large number of manufacturers of motor vehicles does not simply exist in the whole world. The people who think to purchase motor vehicles which they have to use for carrying passengers or transporting goods first purchase a chassis from the 4/5 large scale manufacturers. Then they commission the petitioners or other body builders to build/ fabricate body thereon. Thereafter they put the motor vehicle into use. But the owner of a chassis d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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