TaxTMI 
TaxTMI 
2015 (10) TMI 612
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....7-CE dated March 01, 1997 as the said Notification exempted 'Concrete Mix' (for short, 'CM') and not RMC. In the other appeal, wherein the assessee/ respondent is M/s. Chief Engineer, Ranjit Sagar Dam (hereinafter referred as 'Ranjit Sagar Dam'), the judgment impugned is that of the Punjab & Haryana High Court taking a contrary view. Here, the High Court has held that RMC manufactured at the assessee's plant would be entitled to exemption inasmuch as the Notification exempts all kinds of CM from payment of duty, which would include RMC as well 2) It is clear from the above that the issue which arises for consideration is identical in all these appeals. For this reason, they were heard analogously and are being disposed of by the present judgment. We shall, in the first instance, take up the appeals of L&T. Civil Appeal Nos. 6930-6931/2005 & Civil Appeal No. 2121/2006 3) L&T was constructing its own cement plant at Bhogasamundram, Anantpur. For the purpose of the construction of civil structure of the said cement plant, L&T required CM, it used to prepare said CM at site with the help of machinery installed there and the said CM was captively con....
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.... quality. It was submitted that use of additives to increase the time period over which the concrete can be used is not a decisive factor. Since the L&T needed large quantities of ready mix concrete, they had put up a plant for producing ready mix concrete at the site and therefore, there was no need for use of retarders. It was also pleaded that the Commissioner ignored the contention of L&T that the subject product was CM conforming to the requirements of IS 456:1978. Rather, he relied on IS 4726:1976 for the ready mix concrete and held that the product manufactured by L&T at the site of construction is RMC. 6) L&T also referred to earlier proceedings by pointing out that the CBEC had issued a Circular No.315/31/97-CX dated May 23, 1997, in which it was clarified that RMC, even though it is manufactured at the site of construction, is chargeable to excise duty under sub-heading No.3824.20 of the Central Excise Tariff Act, 1985. The exemption for CM manufactured at the site of construction for use in construction work at such site available under Notification No.4/97-CE dated March 01, 1997 is not applicable to RMC manufactured at the site of construction. L&T had challenged th....
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....truction work at such site. Prior to the above notification, under the previous applicable notification also i.e. Notification No.36/94-C.E. dated March 01, 1994 'Concrete Mix' manufactured at the site for use in construction work was exempted from excise duty, i.e. all along the excise duty for 'concrete mix' manufactured at the site remained 'NIL' Prior to March 01, 1997 there was some doubt expressed as to the excisability and classification of the product 'Ready Mix Concrete'. The Trade was claiming classification of the product under heading 68.07 with benefit of exemption from central excise whereas the department stand was that 'Ready Mix Concrete' was classifiable under sub-heading 38.231 of the schedule of Central Excise Tariff Act as it stood prior to March 01, 1997. 9) It is clearly discernible from the above that the Legislature has treated RMC and CM as two different products. Whereas CM has generally been covered by the exemption notification, such an exemption is not extended to RMC. Even when doubts were raised from time to time about the two products, Government has always been clarifying and emphasizing that the two....
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....instant case demand of excise duty from L&T on the footing that it has manufactured RMC at the site of construction is not sustainable for various reasons. In support of this plea, he paraphrased his submissions in the following manner: (i) Product-wise, there is no difference between ready mix concrete and concrete mix. This is clear from IS 456, industry standard for all types of concrete mix and IS 4926 industry standard for ready mix concrete. IS 4926 refers to IS 456 for specifications on product ingredients and manufacturing process. IS 4926 defines ready mix concrete as a concrete mixed in a batching plant and delivered at the site of the purchaser for use. This standard deals with management aspects of maintaining plant, delivery process, interaction with customer, sampling and testing for quality control, order processing and records. Thus, IS 4926 is concerned with commercial aspects of industry practices of ready mix concrete, which by definition is concrete mix manufactured at one place and delivered at another place for use. (ii) Since L&T was manufacturing concrete mix at the site for self-use in construction of cement plant, it was not manufacturing ready mix c....
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....t. (vi) Before the Commissioner, L&T had taken the following arguments, which were not considered. (a) CBEC in circular dated January 06, 1998 has classified that ready mix concrete could not be manufactured at the site. (b) Ready mix concrete is a type of concrete mix, which is manufactured at one place and transported for delivery at the site of construction. This is not the case with L&T. (c) No sample has been drawn by the Department to find whether the goods produced were ready mix concrete or concrete mix. (d) The concrete mix produced at the site was used without delay, and had no shelf-life. Hence, it was not excisable. (e) The goods are classifiable under CH 68.07 in view of the ruling in Associated Cement Co. Ltd. (supra). Hence, exempt under notification No. 4/97 (serial No.68.2). Alternatively, if classification is sought to be made under CH 38, site mixed concrete was also exempt under this notification. 14) From the aforesaid submissions of Mr. Sahu, it becomes apparent that basic thrust of his argument is that CM and RMC are one and the same thing. According to him, when Mixed Concrete is prepared at one place from where it is packed and transpor....
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....of Stone Crushers, Conveyors, Vibrator Screens to segregate different sizes of stone aggregates were used, there was addition of sand mill to produce sand from stones and other sophisticated equipments were also used for manufacture of RMC which are taken note of by the CESTAT and these are: (i) Stone Crushers, Conveyors, Vibrator Screens to segregate different sizes of stone aggregates. (ii) Sand mill to produce sand from stones. (iii) Two batching plants in which all aggregates were weighed and batched by electrical controls and limit switches. (iv) Cement silo where cement is stored and carried to the batching plant by a screw conveyor operated with automatic weighing gauges. (v) Flow-meters to feed water after subjecting into chemical analysis. (vi) Mixer to mix stone aggregates sand, cement and water. (vii) Transit mixer mounted on a truck chassis for transporting the concrete to the actual site of construction. 16) He, thus, argued that whether it was done at site or not was irrelevant. He also submitted that the assessee itself accepts that what is produced is RMC, which is different from CM, and the only reason for claiming exemption from excise duty....
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.... between CM and RMC. In the instant case, as it is found, the assessee installed two batching plants and one stone crusher at site in their cement plant to produce RMC. The batching plants were of fully automatic version. Concrete mix obtained from these batching plants was delivered into a transit mixer mounted on a self propelled chassis for delivery at the site of construction is in a plastic condition requiring no further treatment before being placed in the position in which it is to set and harden. The prepared chassis which was mounted was to ensure that when the concrete mix is taken to the actual place of construction, it keeps rotating. It is also significant to mention that for producing the concrete mix, material used was cement, aggregates, chemically analysed water and admixtures, namely, retarders and plasticizers. As the L&T was constructing cement plant of a very high quality, it needed concrete also of a superior quality and to produce that aforesaid sophisticated and modernised process was adopted. The adjudicating authority in its order explained the peculiar feature of RMC and the following extracts from the said discussion needs to be reproduced: "32.....
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....tics as regards the plant and machinery required to be set-up for its manufacture and the manufacturing processes involved, as well as its own properties and the manner of delivery. RMC refers to a concrete specially made with precision and of a high standard and as per the particular needs of a customer and delivered to the customer at his site. Apparently due to the large demand resulting from rapid urbanization and pressure of completing projects on time, consumption of RMC has steadily grown replacing the conventional/manual concreting works. Today leading cement companies have entered the field by setting-up RMC plants in which L&T ECC is one. RMC is slowly replacing site or hand mixed concrete because of the distinct advantages due to technology, speed and convenience. Furthermore, absence of the need to deal with multiple agencies for procuring and storing cement, sand, blue metal and water as well as the absence of the need to handle unorganized labour force are factors influencing customers to go in for RMC in preference to CM." 21) In this backdrop, the only question is as to whether RMC manufactured and used at site would be covered by notification. Answer has to be i....