TaxTMI 
TaxTMI 
TaxTMI 
2006 (9) TMI 318
X X X X Extracts X X X X
X X X X Extracts X X X X
....el wires and their licensed capacity permitted them to manufacture 9600 MT of stranded wires viz. high tensile stranded normal relaxation wire (HTSNRW). The total licence capacity of all the products manufactured was 77,110 MT. They approached the Ministry of Industries for substantial expansion of capacity to manufacture prestressed concrete wires from 9,600 MT per annum to 20,000 MT per annum with simultaneous reduction of capacity of other wires to the same extent. The necessary permission was granted by the Ministry of Industries vide their letter dated 4-12-1992 in which the applicants were allowed to increase/produce high tensile stranded low relaxation wires (HTSLRW) to the extent of 10400 tonnes in addition to existing 9600 tonnes o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r : "Unit'' means any self contained portion of an industrial plant or any self contained portion of a project specified under the said heading No. 98.01 and having an independent function in the execution of the said project." 3. The tribunal agreed with the submissions made by the appellants and allowed the applicants case on the question of interpretation of legal provisions remanded the matter back to the original authority for passing a fresh order after causing verification as to whether the imported goods were for expansion of capacity to produce HTSLRW or not. 4. The matter was thereafter re-adjudicated by the Commissioner Customs who again denied the benefit on the ground that this was not a case of expansion of capaci....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 52600 MT, the second unit manufacturing bright bars having a licence capacity of 4500 MT and the third unit manufacturing stranded wires had a licence capacity of manufacturing 20000 MT. It was submitted that the machinery employed for manufacture of stranded wires was totally independent of the other units and were used only for the manufacture of stranded wires and no other wires. There were three dedicated wire drawing machines in the stranded wire unit and the other units had their separate wire drawing machines and, therefore, even if the other two units were dismantled, the stranded wire unit will still function on its own as it was not dependent on any of the other two units. In view of this, there has been a substantial expansion o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed that a replacement of a machinery by a new machinery does not amount to substantial expansion as has been held by the Tribunal in the case of Travancore Titanium Products v. CC - 2002 (148) E.L.T. 640 wherein it was held that modernization of unit is not something as substantial expansion of the unit. In that case machinery for production of 300 tpd of sulphuric acid was replaced by new machinery by production of 450 tpd of sulphuric acid by new technology. This decision was upheld by Supreme Court [2003 (154) E.L.T. A175 (S.C.)]. 8. We have considered the submissions. We find that in the earlier round the applicant has before the Tribunal taken a consistent stand that there has been an expansion in the capacity to produce HTSLRW u....
X X X X Extracts X X X X
X X X X Extracts X X X X
....as submitted that it is having three units only i.e. steel wires, bright bars and stranded wires. We further observe that the basic machinery for manufacture are the wire drawing machines for drawing wire from wire rods which by relocation and slight modification can produce wires of different kinds and the overall wire drawing capacity has not undergone change. In the case of stranded unit before expansion there were three dedicated wire drawing machines which after expansion also remained three. The applicants have not imported any further wire drawing machine nor were permitted to do so under the industrial licence given by the Ministry of Industries. Thus, there have been a change only in the stranded machine which was substituted and n....