Body-building on chassis treated as manufacture under Chapter 87, supporting exemption eligibility and unconditional stay.

Chapter Note 5 of Chapter 87 treats body-building, fabrication, maintenance or fitting on chassis falling under Heading 8706 as manufacture of a motor vehicle, so exemption eligibility must be assessed in light of that statutory note. Earlier tribunal rulings on the pre-amendment position were not controlling. On that reasoning, the activity produced motor vehicles classifiable under Heading 87.04 and the exclusion in Notification No. 6/2006-C.E. was not attracted; the assessee was therefore regarded as having a strong prima facie case for unconditional stay.

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Issues: Whether body-building or fabrication on chassis supplied by customers amounted to manufacture of motor vehicles under Chapter Note 5 of Chapter 87 and whether the benefit of Notification No. 6/2006-C.E. was available.

Analysis: Chapter Note 5 of Chapter 87 specifically provides that building a body, fabrication, maintenance or fitting of structures on chassis falling under Heading 8706 amounts to manufacture of a motor vehicle. The earlier tribunal decisions relied upon below related to the period before the insertion of this note and therefore could not govern the present dispute. Since the activity resulted in motor vehicles classifiable under Heading 87.04, the exclusion in the notification was not attracted on the reasoning adopted by the lower authority.

Conclusion: The assessee was entitled to the benefit of the notification and had a strong prima facie case for unconditional stay.

Ratio Decidendi: Where a specific chapter note treats body-building on chassis as manufacture of a motor vehicle, exemption eligibility must be determined in light of that statutory note and not on pre-amendment decisions.

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