TaxTMI 
TaxTMI 
2014 (4) TMI 580
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.... for the transport of goods other than compressed or liquefied gas of different capacity which are mounted and fitted on chassis. M/s Super Industries were claiming SSI Exemption under Notification No.1/93 CE dt.01.03. 93 and other analogues notifications. They were also filing declaration under Rule 173 B in respect of said goods classifying Cylindrical Tanks for compressed or liquefied gas and bodies for the Motor Vehicles of heading No. 87.01 to 87.06 under 8707 and claiming exemption under Notification No. 8/2001 - CE dt.01.03.2001. M/s Super Industries alongwith other Units were issued show cause notice dt.11.10.2005 wherein the following demands were proposed and they were directed to show cause as to why: (i) A demand of 2,40,53,169/- be not raised against M/s Super Industries on 1197 nos of tank bodies falling under chapter sub-heading 8707 which were fabricated and captively consumed in the manufacture of Motor Vehicle of chapter heading 8704.20 for the transportation of goods other than compressed or liquefied gases during the period 2000 to 2004 -05; including duty on clearance allegedly made by M/s Royal Engineering and Ankit Engineering said to be dummy concerns of M/....
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....ineering; however except some statements there is no evidence that M/s Royal Engineering did not undertake any manufacturing activity at the said premises. Even from the panchnama dt.30.04.2005 made at the factory premises of M/s Royal Engineering, it can be seen that the pressing/bending lathe machine and colour spraying machine were installed. In the panchnama it has been contended that the said machines were not operational which is not correct as the same has no base. It is his submission that M/s Royal Engineering is proprietory firm of Shri Suresh Rathore and was engaged in fabrication and mounting of tank bodies. Even the Department of Explosives has granted licence to the tank bodies manufactured by M/s Royal Engineering which itself shows that the tank bodies and other goods were manufactured by M/s Royal; moreover M/s Royal Engineering in the year 2002 surrendered their manufacturing licence as they stopped manufacturing excisable goods. It is the submission that the issueance of licence and its surrender itself shows that M/s Royal Engineering existed and was operational as an Excise licence is issued only after detailed verification of the factory premises; M/s Royal En....
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....hicles and thus the tanks fitted on such trailers/ running gear merits classification under Chapter sub heading 87.16. The ld.Counsel for the appellant M/s Super Industries also produced photographs of such tankers manufactured on semi trailers/ running gear which showed tanker rear end mounted on the rear wheel while front rests on the chassis of prime moving vehicle; in some photographs the semi tanker was coupled through special coupling device to the prime mover. The ld. Counsel Appellant further submits that as apparent from the show cause notice itself one of the units M/s Rashmi Enterprise is engaged in manufacture and dealer of running gear on which tank is fitted and that the said facts are apparent from the certificate issued by the Department of Explosives where the trailer chassis number is separately mentioned and therefore the goods are classifiable under chapter sub-heading 87.16 as held by the Tribunal in the case of HEATWELD Vs. CCE 1992 (57) ELT 432 and thus they are eligible for SSI Exemption. He submits that the issue of classification of the goods can be argued at any stage and thus they are eligible to raise this issue at Appellate stage. The Ld. Counsel furth....
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....e views in respect of classification of goods and eligibility for Exemption in respect of both the category of goods i.e. whether the goods manufactured for the transportation of goods other than Compressed or Liquefied gas or the goods for transportation of compressed or liquefied gas were not correct as apparent from their submission; whereas the goods for transportation of goods other than compressed or liquefied gas are exempted in terms of Notification No. 6/2000- CE dt. 01.03.2001 and other analogus notifications and the goods for the transportation of compressed or liquefied gas are classifiable under chapter sub heading 87.16, that the issue involved is of interpretation and classification which shows that there can be a bonafide belief on the part of the Appellant regarding the goods being exempted. It is submitted that even the adjudicating authority before confirming the demand has dwelt upon the classification of goods as well as interpreted the eligibility of exemption Notification and even now before the Hon'ble Tribunal the issue to be decided is classification of goods, therefore the demands pertaining to the period before one year of the issue of the show cause not....
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....ged in manufacturing activity. Also, in the records of Department of Explosives, the vehicles/goods were shown to have been manufactured by M/s Royal Engineering. Taking into account all these facts, we are of the considered view that M/s Royal Engineering cannot be held as dummy of M/s Super Industries and their clearances cannot be clubbed into the clearances of M/s Super Industries. 12. In respect of goods manufactured for the purpose of transportation of goods other than compressed or liquefied gas the demand is on 1197 of Tank Bodies classified under 87.07. We find that during the period July' 2000 to Feb'2001 the tank bodies manufactured and consumed within the same factory for the purpose of mounting on the chassis of a motor vehicle of heading No. 87.02 or 87.04 were exempted from duty in terms of serial No. 253 and condition No. 52 of Notification No. 6/2000- CE dt. 01.03.2000 which reads as under: Serial No. 253 - Exemption to goods falling under Any chapter - All goods manufactured in a factory and used within the same factory for building a body or fabrication or mounting or fitting of structure or equipment....
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....of gas were mounted on semi trailers/ running gears and the same were coupled with the prime movers i.e. the Motor Vehicle for transportation of such tanks. We are of the view that since the tanks of such vehicles were not manufactured/ fabricated on chassis of Motor Vehicles but on semi trailer/ running gear, consequentially the goods merits classification under chapter sub heading 87.16 as held in the case of Mitusha Vessels & Engineers Pvt. Ltd Vs. Comm. 1999 (114) ELT 239 (Tri) and Heat Weld Vs. Collector 1992 (57) ELT 432 (Tri). We are of the view that the Appellant's submission has force and it has also to be held that these vehicles being classifiable under chapter heading 87.16 are eligible for SSI Exemption in terms of Notification No. 8/2000 -CE dt.01.03.2000, 8/2001 - CE dt.01.03.2001, 8/2002 - CE dt.01.03.2002, 8/2003 - CE dt. 01.03.2003. We thus hold that while computing the duty demand, the Appellant needs to be extended the benefit of relevant SSI Exemption Notifications as per the conditions contained therein. We also find force in the submission of the Appellant from the instances produced before us that the demand of duty has been made twice or thrice on the same ....