TaxTMI 
TaxTMI 
2016 (11) TMI 996
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....95. Notification No.07/95-CE interalia exempted capital goods as defined in Rule 57Q of the Central Excise Rules, 1944 manufactured in the factory and used within the factory of production. The original adjudicating authority has held that the goods are not classifiable under heading 84.27 or 84.28 as claimed by the appellant, but they are classifiable under heading 73.08/73.26 of CETA. Relying on the decision of Maruti Udyog Ltd., Vs. CCE - 1998 (01) ELT 675, the Commissioner (Appeals) observed that the goods cannot be treated as capital goods. Aggrieved by the said order, the appellants are in appeal before this Tribunal. 2. The learned Counsel for the appellant argued that the Larger Bench of this Tribunal in the case of Banco Products (India) Ltd. Vs. CCE, Vododara - 2009 (235) ELT 636 (Tri-LB) has held that the plastic crates used as material handling device within factory of production are capital goods and are entitled for the benefit of Notification No.217/86-CE. He particularly relied on para 23 which reads as under: 23. By various decisions of the Tribunal, in number of cases, it has held that the equipment used for collecting, transporting or dispensing material be....
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.... of manufacture. The Hon'ble Supreme Court in the said decision has observed as follows: 2. The process of manufacturing of motor vehicles parts involves various operations. The appellant, for this purpose, also makes use of material handling equipments like hand trolley or fork lift etc. These trolleys and fork lift are placed on iron/steel or aluminum known as "3 FAG Pallets". These pallets are manufactured by the appellant in its own factory and captively used for the aforesaid purpose. 3. Two issues have arisen in respect of these pallets. First relates to its classification and second issue is as to whether the appellant, in respect of the aforesaid pallets, can claim benefit of Notification No. 67/95-C.E. dated 16-3-1995, as amended and prevalent on the date when the dispute arose, namely, in the year 1999. 4. The appellant had filed its declaration claiming classification under Chapter Heading 84.31 and had also claimed benefit of the aforesaid Notification. This was denied by the adjudicating authority and the view of the adjudicating authority has been affirmed by the CESTAT in its impugned judgment dated 1-12-2004. As per the Department the goods in question are ....
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....fication of Pallet frame assembly which moves on rails. We, therefore, hold that the impugned pallets, being not part of fork-lift trucks, are not classifiable under Heading 84.31 of the Tariff." 6. Insofar as the second question is concerned, namely, whether benefit of exemption under Notification No. 67/95 issued under the Central Excise Act, 1944 is available in respect of these pallets or not, we find that the Tribunal has held that the Notification exempts capital goods, as defined in Rule 57Q of the Central Excise Rules, 1944, manufactured in a factory of production and at the material time as per the definition of capital goods given in Rule 57Q, goods falling under the Chapter were not covered within the said definition. 7. We have been taken through the aforesaid Notification dated 67/95, as amended in the year 1996 which was in vogue in the year 1999 as well. The language of the said Notification makes it clear that it exempts the following kind of goods : (i) Capital goods as defined in rule 57Q of the Central Excise Rules, 1944 manufactured in a factory and used within the factory of production; (ii) goods specified in column (2) of the Table hereto annexed ....
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....an the following, namely, - (i) goods classifiable under any heading of Chapter 24 of the Schedule to the said Act; (ii) goods classifiable under Heading No. 36.05 or 37.06 of the Schedule to the said Act; (iii) fabrics of cotton or man made fibres falling within Chapters 52, Chapter 54 or Chapter 55 of the Schedule to the said Act; (iv) fabrics of cotton or man made fibres falling within Heading No. 58.01, 58.02, 58.06 (other than goods falling within Sub-heading No. 5806.20), 60.01 or 60.02 (other than goods falling within Sub- 8. As per para (i) above, capital goods which are defined in Rule 57Q of the Rules, manufactured in a factory and used within the factory of production are exempted. We perused the definition of "capital goods" appearing in Rule 57Q which was in operation at the material time and find that the goods in question are not covered by the said definition. However, as per para (ii) those goods which are specified in Column (ii) of the Table which is appended to the said Notification and manufactured in a factory and used within the factory of production in or in relation to manufacture of final products specified in column (3) of t....