2000 (4) TMI 55 - AT - Central Excise

Appellants denied exemption as goods not manufactured in designated workshop for repair/maintenance.

TISCO LIMITED Versus COMMISSIONER OF CENTRAL EXCISE, MADRAS

The Tribunal concluded that the appellants were not eligible for the exemption under Notification No. 281/86-C.E. The appeals were dismissed as the goods ... Exemption to goods - Interpretation of Statute Issues Involved:1. Interpretation of the term 'workshop within a factory' in Notification No. 281/86-C.E.2. Eligibility for exemption u/s Notification No. 281/86-C.E. for goods manufactured in a factory and used for repairs or maintenance in the same or another factory of the same manufacturer.Summary:1. Interpretation of the term 'workshop within a factory':The core issue in these appeals was the interpretation of the term 'workshop within a factory' as used in Notification No. 281/86-C.E., dated 24-4-1986. The appellants argued that the absence of a definition for 'workshop' in the notification implied that the entire factory should be considered a workshop. They relied on the definition of 'factory' in Section 2(e) of the Central Excise Act and various dictionary meanings of 'workshop'. They also cited previous CEGAT decisions, such as Indian Iron & Steel Co. Ltd. v. C.C.E. and Steel Authority of India Ltd. v. C.C.E., Raipur, to support their interpretation.The Revenue, however, maintained a clear distinction between 'factory' and 'workshop', arguing that the exemption applied only to goods manufactured in a workshop within a factory, not to the general production of the factory. They emphasized that exemptions should be construed strictly, as supported by the Supreme Court decision in Novopan India Ltd. v. Collector of C. Ex. and Customs, Hyderabad.2. Eligibility for exemption u/s Notification No. 281/86-C.E.:The Tribunal examined the facts of the cases and found that the appellants did not have separate workshops within their factories where the goods in question were manufactured. The goods were part of the general production of the factories, not specifically produced in a workshop for repair or maintenance purposes.The Tribunal held that the notification's language was clear and unambiguous, granting exemption only to goods manufactured 'in a workshop within a factory'. The intention was to provide exemption to a specific class of goods, not to the entire production of a factory. The Tribunal emphasized that interpreting the notification to treat certain words as surplus would broaden the scope of the exemption beyond the legislature's intent.Conclusion:The Tribunal concluded that the appellants were not eligible for the exemption under Notification No. 281/86-C.E. The references were answered accordingly, and the appeals were dismissed. The Tribunal reiterated that the exemption was limited to goods separately produced in a workshop within a factory for repair/maintenance purposes, not to the commercial/mass production of the factory.