TaxTMI 
TaxTMI 
1989 (10) TMI 130
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.... of Rs. 17,43,00,149/-. For the execution of these contracts they had cleared machinery items from their factory at Jamshedpur on payment of duty. Total amount of duty paid on those items was Rs. 33,44,00,880/-. It was alleged in a show cause notice dated 16-1-1982 against the appellants as follows :- " M/s. TRF Ltd., Jamshedpur knew that as per standing orders and instructions, the goods falling under T.I. 68 which are cleared in knocked down condition to be assembled at site and over a period of time against a particular contract, clearances are assessable to duty on the value of the articles in completely assembled condition. ............................................................................................................................ ............................................................................................................................ Thus it is evident that M/s. TRF have not discharged their duty liability fully on the goods of T.I. 68 manufactured by them in completely assembled condition and in this way it appears that they have evaded payment of duty approximately of Rs. 1,05,94,116/-. The actual amount of duty evaded is, howe....
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.... to evading duty. 3. The adjudicating authority, namely CCE, Patna has given the following findings on the 4 issues examined by him :- 1st Issue- (1) Whether or not M/s. Tata Robins Fraser Ltd. are liable to pay duty on the full value of the contract order for the execution of which certain items of machinery/equipments were cleared from their works at Jamshedpur, certain items were purchased from the market and other items got fabricated from other parties. Collector's Findings. - In the instant cases machinery items appears to have been manufactured at site out of the components partially obtained from the assessees works at Jamshedpur which were finally assessed to duty and partially bought from the market. Thus dutiability of the goods manufactured at site in such cases would have to be determined independent of the duty already paid on the components, whether the same was brought from the manufacturers works or from the market. If some goods have actually been manufactured at site their duty liability would have to be fixed independently on its value irrespective of the duty already paid on the inputs. of course, whatever set-off of duty on inputs is permissible wh....
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.... 5. Hyderabad Race Club v. Collector of Central Excise - 1986 (23) E.L.T. 274 (paras 7 to 9) (CEGAT) 6. Braithwaite Co. v. Collector of Central Excise -1987 (29) E.L.T. 251 (paras 5 and 6) (CEGAT). 4.1. Contending against the aforesaid proposition of the learned Advocate for the appellants Shri G.V. Naik, learned JCDR relied upon Patna High Court's judgment reported in 1988 (33) E.L.T. 297 (Patna) (TISCO v. U.O.I.). It was pointed out that the Patna H. C. did not accept the judgment of Government of India in the case of Otis Elevators mentioned supra. The learned JCDR also relied upon Supreme Court's judgment in the case reported in 1988 (38) E.L.T. 566 (Name Tulaman Mfg. Co. v. C.C.E.). 4.2. Distinguishing the aforesaid two authorities relied upon by the learned JCDR, the learned Advocate for the appellants has submitted that in the case before the Patna High Court TISCO had manufactured a complete crane at their factory, gave inspection and trial run at their factory and it was in these circumstances that the High Court came to the conclusion that the excisable goods namely cranes came into existence at TISCO's factory and thereafter the said crane was removed in CKD con....
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....-si Dass v. State of Madhya Pradesh) and AIR 1971 S.C. 908 (State of Maharashtra v. Champalal K. Mohota). An immovable property cannot, therefore, be charged to excise duty. 5.1. The adjudicating authority has not pointed out as to which items have been specifically assembled at site out of the components brought by the appellants at site either from their own works or from the independent fabricators or purchased from the market. The adjudicating authority has apparently taken the completion of the project as the assembly of the machinery at site. The project by 'itself being an immovable property cannot be charged to duty. This is apparent from his findings when he states while dealing with the appellants' reliance on Government of India's order in the case of Otis Elevators (India) Ltd. that the immovable property has not been charged to duty because the appellants have been given the benefit of deduction of erection, installation and commissioning charges charged by them. It has been stated by the appellants that they manufacture various items at their Jamshedpur factory for outright sales or for clearance on their own account to fulfill their construction contracts. There i....
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.... Others [1986 (25) E.L.T. 609] and (ii) Shree Agency v. S.K. Bhattacharjee & Others [1977 E.L.T. J 168-Para 10]. As against this advocate for the appellants relies on a long list of authorities as follows :- (1) Andhra Rerolling v. Union of India -1979 (4) E.L.T, 600 (A.P.) (2) Gangadhar v. Collector of Central Excise, Allahabad -1979 (4) E.L.T. 597 (Para 4) (Allahabad) (3) Philips India v. Union of India -1980 (6) E.L.T. 263 (Allahabad) (4) Metal Box v. Collector of Central Excise -1986 (23) E.L.T. 187 (CEGAT) (5) Kalsi Tyres v. Collector of Central Excise -1986 (26) E.L.T. 631 (CEGAT) (6) Prasad Engineering v. Collector of Central Excise -1987 (31) E.L.T. 247 (7) R.K.H. Industries v. Union of India -1984 (16) E.L.T. 40, para 4 (Bombay) (8) Lucas Limited v. Collector of C. Ex. -1984 (16) E.L.T. 415 (CEGAT) * (9) Collector of Central Excise v. Modo Plast -1985 (21) E.L.T. 187 (CEGAT) (10) Standard Motors v. Collector of C. Ex. -1985 E.C.R. 1807 (CEGAT) -1986 (24) E.L.T. 155 (Tri.) (11) Jay Engineering v. Collector of Central Excise - 1985 (21) E.L.T. 299 (CEGAT) (12) P.M. Abdul Latif v. Assistant Collector -1985 (22) E.L.T. 758 (Madras) (13) T....
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.... hinted at in the impugned order that such fabricators were agents of the appellants. It is for the department to prove by cogent and acceptable evidence that the fabricators were actually puppets in the hands of the appellants. Leave apart from production of any cogent evidence there is absolutely no evidence on record to even hint at in that direction. The adjudicating authority has merely relied upon the legal interpretation given by him to the definition of 'manufacturer' under Section 2(f) of the Central Excises and Salt Act. In view of the series of judgments on this issue we disagree with the interpretation of the Collector. 9. The 3rd issue discussed by the Collector, namely the following need not be dealt with by us because this issue has been decided by the Collector in favour of the appellants. It is for this reason that the Collector has held the appellants liable to differential duty in respect of 12 contracts alone out of 52 contracts executed by them during the relevant period :- "Whether the proper officer to take action on the alleged evasion of duty on the goods said to have been manufactured at site located in other Collectorates is the officer in whose jur....