Exemption for railway wagon components processed by job workers upheld where goods remained identifiable for use in wagon manufacture.

Components of railway wagons sent to job workers for heat treatment, grinding and similar processing, and then returned for further use in wagon manufacture, were treated as covered by the exemption entry for parts of railway wagons under Serial No. 252 of Notification No. 6/2002 dated 1-3-2002. The decisive point was that the goods remained identifiable as wagon components and were processed only for continued use in the manufacture of railway wagons. On that basis, the exemption applied and the demand did not survive.

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Issues: Whether components of railway wagons sent to job workers for heat treatment, grinding and similar processing, and returned for use in the manufacture of railway wagons, were eligible for exemption under Serial No. 252 of Notification No. 6/2002 dated 1-3-2002.

Analysis: The goods were components of railway wagons which were subjected to processing by job workers and thereafter returned to the factory for further use in the manufacture of railway wagons. On that footing, the goods answered the description covered by the exemption entry relied upon by the assessee. The Tribunal therefore treated the goods as falling within the exemption specified in Serial No. 252 of Notification No. 6/2002 dated 1-3-2002.

Conclusion: The exemption was applicable, and the demand did not survive against the assessee.

Final Conclusion: The appeals succeeded and the departmental cross-objections were disposed of accordingly.

Ratio Decidendi: Goods that are identifiable as components of railway wagons and are processed by job workers for continued use in the manufacture of railway wagons can be covered by the relevant exemption entry for parts of railway wagons.

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