2016 (3) TMI 435

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....Volvo India Ltd. under two purchase orders  one for manufacture of the bodies and the other for mounting the same on chassis under the procedure of job work challans. The appellant paid duty of central excise on the bodies so fabricated and sold by them to their customers and in respect of the mounting charges, they paid the service tax by treating the said part of the contract as service. 3. Consequently by way of show-cause notice dated 27.02.2006, it was proposed to confirm the demand of duty in respect of the bodies which were being cleared by them after being mounted on the chassis on the ground that the mounting activity is part and parcel of the manufacturing activity in terms of the provisions of Chapter Note 3 of Chapter 87 a....

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....sion or malafide misstatement so as to invoke the longer period of limitation. He strengthens the above argument by submitting that whatever duty was paid by them was being availed as credit by their customers and as such there can be no motive for them to pay less duty. The entire situation was revenue neutral and as such he submits that the demand is barred by limitation. However, he fairly agrees that a part of the demand would fall within the limitation period for which they are ready to discharge their duty liability subject to adjustment of service tax paid by them. He also prays for setting aside the penalty as there was no malafide on their part. 5. Countering the arguments, learned A.R. submits that filing of service tax returns a....