TaxTMI 
TaxTMI 
2017 (2) TMI 672
X X X X Extracts X X X X
X X X X Extracts X X X X
.... contested by the appellant on the ground that they procured duty paid MS Channels, MS Plates and MS Angles and the processes undertaken by them does not amount to manufacture. The demand was also assailed on limitation. However, the original adjudicating authority confirmed the demand alongwith imposition of penalty of Rs. 10,000/-. 3. The appeal was filed before the Tribunal, who vide its final Order No.486-488/1999 dated 23.04.1999 set aside the same. The said order of the Tribunal was challenged by the department before the Hon'ble Supreme Court, who vide their order dated 19.04.2001 remanded the matters to the Tribunal who vide their further order dated 07.10.2002 remanded the matters to the adjudicating authority for denovo adjudication. 4. In the meanwhile, further twelve notices were also issued to the appellant raising demand of duties totalling amounting to Rs. 1,75,64,008/- (One crore seventy five lakhs sixty four thousand eight only). All the show cause notices were taken for adjudication and vide a common order-in original dated 04.02.2004, the Additional Commissioner, after taking into account the manufacturing process as also various decisions of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ructures/ electric towers by the party. Thus from the foregoing and on the basis of various decision as referred above, it is now apparently clear that the process carried out by the party do not amount to manufacture as no new 'excisable' goods come into existence. In other words the various processes carried out by the party do not bring any change in the raw material so that the resultant product can be treated as a new different commodity having a distinct name, character or use in business or commercial parlance. In the case of UOI Vs. Delhi Cloth & General Mills co. Ltd. [1997(1) ELT (J199)SC], the Hon'ble Supreme Court has held that "manufacture implies a change, but every change is not manufacture and yet every change of an article is to the result of treatment, labour and manipulation. But something more is necessary and there must be transformation, a new and different article must emerge having a distinctive name, character or use". It follows from the above judgment that manufacture necessarily implies that there must be a conversion of the input goods into some other distinct and commercially known goods. The mere fact that the goods are processed would not....
X X X X Extracts X X X X
X X X X Extracts X X X X
....smission towers and not as original raw materials. It appears that this aspect has not been discussed in any of the case laws quoted by the appellant. Since parts of transmission towers are very well covered under Chapter Heading 73, the said goods have become excisable goods liable to discharge payment of appropriate duty. I hold accordingly". Hence the present appeal. 6. We have heard Shri L. P. Asthana, Id. Advocate for the appellant and Shri Pramod Kumar, Id. Jt. CDR for the Revenue. We find that the issue of cutting to size, punching and drilling of various iron and steel items as amounting to manufacture or not has been the subject matter of various decisions. However, before we revert to the said decisions, we deem it fit to reproduce the processes undertaken by the assessee, as stand detailed in the order of the Additional Commissioner. S. No. Raw Material Process under taken Items made 1. M. S. Channel 100x50 mm Peaces of 9 feet each are cut with holes made therein which are fitted with poles. DC 8' Centre 2. M.S. Plate 50x6 mm Pieces of 11" length are made and bended in U shap....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... applicable. We further note that the Tribunal in the case of Elecon Engineering Co. Ltd. vs. CCE, Chandigarh reported as 2005 (190) ELT 195 (Tri. Del.) held that columns, purlines etc. fabricated by cutting, drilling, punching and welding on duty paid channels and angles and thereafter assembled to the post at work site does not amount to manufacture and cannot be held to be excisable goods inasmuch as no manufacturing activity is involved. For the above proposition they relied upon the Tribunal decision as confirmed by the Hon'ble Supreme Court. For better appreciation we reproduce the relevant para from the said decision. "5. We find that appellants are fabricating columns, purlines etc. by cutting, drilling, punching and welding on duty paid channels and angles and thereafter these are being assembled to post at work site and are fixed in the exact position. In the impugned order it is held that process undertaken by the appellant amounts to manufacture as a new and distinct product has come into existence, which has distinct name and goods in question are classifiable under Heading 7308 of the Central Excise Tariff. The Revenue relied upon the decisions of the Trib....
X X X X Extracts X X X X
X X X X Extracts X X X X
....punching and welding on duty paid channels and angles, for being assembled to the post at work site does not amount to manufacture, the Tribunal has relied on its earlier decision in the case of Aruna Industries, Vishakhapatnam v. C.C.E., Guntur [1986 (25) E.L.T. 580]. The decision of the Tribunal in Aruna Industries (supra) has since been affirmed by a bench of three learned judges in Commissioner, C. Ex., Nagpur v. Wainganga Sahkari S. Karkhana Ltd. [2002 (142) E.L.T. 12 (S.C.)]. In that view of the matter, the issue sought to be raised by the Revenue in these appeals is no longer res integra. Accordingly, following the decision in Wainganga Sahkari S. Karkhana Ltd. (supra), the appeals are dismissed. No costs." 11. The history of decisions as referred above leads us to observe that whereas as on one hand there is a larger Bench decision of the Tribunal against the assessee, on the other hand there are decisions of the Tribunal holding in favour of the assessee, which stand confirmed by the Hon'ble Supreme Court. The Tribunal decision in the case of Elecon Engineering Co. Limited stands upheld by the Apex Court by way of detailed order and not by way of simply ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....' 1999 to March'2003 and is covered by 12 Show Cause Notices. All these 12 Show Cause Notices along with the matter remanded by the Tribunal vide order dt. 09.10.02 mentioned above, were adjudicated by Additional Commissioner vide Order-in-Original dt. 04.02.04 by which after considering the process of manufacture, he dropped the demands holding that the process under taken by the appellant does not amount to manufacture. 14.3. The said order of the Additional Commissioner was challenged by the Department before the Commissioner (Appeals) who vide Order-in-Appeal dt. 10.06.05 reversed the same and allowed the Department's appeal. Against this order of the Commissioner (Appeals), these appeals have been filed. 15. Sh. L.P. Asthana, Advocate, learned counsel for the appellant, has relied upon:- (a) The judgment of the Tribunal in the case of Aruna Industries, Vishakhapatnam & Others Vs. CCE, Guntur, reported in 1986(25) ELT-580 which has been affirmed by the Apex Court vide its judgment in the case of CCE Nagpur Vs. Wainganga Sahkari S Karkhana Ltd., reported in 2002(142) ELT-12(SC); and (b) Tribunal judgment in the case of Elecon Engineering Company Ltd....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Central Excise Tariff not only covered the structures of iron or steel but also covered plates, rods, angles, shapes, section, tubes and the like, of iron or steel, prepared for use in structures. In my view since the Tribunal's judgment in the case of Aruna Industries, Vishakhapatnam & Others (Supra) is with regard to old Central Excise Tariff which existed during period prior to 28.08.1986, when there was no specific heading for structures of iron and steel and parts thereof, this judgment, even if affirmed by the Apex Court, would not be applicable to this case. The Tribunal's judgments in the cases of Elecon Engineering Company Ltd.(Supra) and CCE Nagpur Vs. Wainganga Sehkari S Karkhana Ltd. (Supra) are based on the judgment in case of M/s. Aruna Industries & Others (Supra). However in case of CCE Jaipur Vs. Man Structural Ltd., reported in 2001 (30) ELT-401(SC), the Apex Court remanded the question of excisability of structural of iron and steel to Tribunal observing as under:- "In the judgment and order of the Tribunal that is under challenge, the Tribunal has failed to consider the facts of even a single of the appeals before it. It has proceeded simply upon the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nels but have to be treated as parts of towers. 18. It is also to be seen that heading 73.08 during period of dispute specifically covered Plates, Rods, Angles, Shapes, Sections, Tubes and the like prepared for use in structurals of iron and steel. The Larger Bench of the Tribunal in the case of Mahindra & Mahindra Ltd. Vs. CCE, Supra has held that though mere drilling of holes or mere cutting jobs in isolation may not, by themselves, amount to manufacture, converting the raw-materials like Angles, Channels, Tubes, Plates etc. to bring about a new commodity will surely amount to manufacture as it is not mere drilling holes or cutting but the activity is aimed at bringing about a distinct commodity. The process of cutting, drilling of holes, bending, welding etc. of MS Angles, Channels and Plates to make parts of Transmission Towers like "HT Lines", 11KV Cross Arms", "11KV top Clamps" "DC-8'Centre", "U Clamps" "Four Pin Arms", "Thick Washers (non threaded)" etc. therefore, amounts to manufacture. 19. As regards marketability, it is seen that there are a number of internet websites of manufacturers of Power Transmission Towers and part thereof which display these prod....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lace this matter before Hon'ble president for nominating a third member/constituting a bench for dealing the following point of difference:- "Whether subjecting the MS Angles, Channels, Plates etc. to the process of to cutting to the required size, drilling holes, riveting, welding etc. to fabricate "H T Lines" "11KV 'V' Cross Arms", "11KV top Clamps", "DC-8'Centre" "U Clamps "Four Pin Arms" etc. which are used as parts of Transmission Tower, amounts to manufacture and would attract central excise duty". (Archana Wadhwa) Member (Judicial) Rakesh Kumar Member (Technical) Per. B. Ravichandran : The present decision is in terms of reference to third Member to resolve a difference of opinion between Member (Judicial) and Member (Technical) in deciding the appeal. Vide the interim order No. 897/2014 dated 14/10/2014, the following difference of opinion has been recorded between these two Members : "Whether subjecting the MS Angles, Channels, Plates etc. to the process of to cutting to the required size, drilling holes, riveting, welding etc. to fabricate "HT Lines", "11KV 'V' Cross Arms", "11KV top Clamps", "DC-....
X X X X Extracts X X X X
X X X X Extracts X X X X
....above. The Revenue in the written submission claimed that the decision of the Hon'ble Supreme Court is sub-silentio on the decision of the Hon'ble Supreme Court in CCE, Jaipur vs. Man Structurals Ltd. reported in 2001 (130) E.L.T. 401 (S.C.) and the Larger Bench decision of Tribunal in Mahindra & Mahindra Ltd. vs. CCE, Aurangabad, Chandigarh, Kanpur & Chennai reported in 2005 (190) E.L.T. 301 (Tri. - LB). It was further submitted that these two decisions are relevant to the facts of the case and as such the decision of the Hon'ble Supreme Court as referred to by the appellant's in their own case cannot be relied upon. 5. In this connection, I note that the Tribunal's order in appellant's own case referred to (supra) is on the same issue as to whether the activity of the appellant of producing transformed structures from MS Rods, MS Channels etc. amounts to 4 manufacture. The Tribunal held, based on the affirmation its earlier decision in the case of Commissioner vs. Tamil Nadu Electricity Board reported in 1996 (82) E.L.T. A158 (S.C.) by the Hon'ble Supreme Court vide order dated 31/07/2015. On appeal against the Tribunal's order the H....