2017 (2) TMI 834

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....y confirmed demand of excise duty to the tune of Rs. 2,75,563/- along with penalty of equal amount and interest applicable thereon, on the ground that the appellant has undertaken manufacture of computers with the brand name of NOVO which belonged to another person. Consequently, the appellant was also denied the benefit of small scale industry exemption Notification. Against the order confirming the demand for the period 2.10.2000 to 9.11.2001, the appellant filed appeal before Commissioner (A), who upheld the original order. Hence the present appeal. 2. With the above background, we heard Shri Raghavendra Hanjer, learned advocate for the appellant as well as Shri Mohammed Yousuf, learned AR for the Revenue. 3. The learned advocate empha....

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....ies of the appellant can be construed as manufacture and thus duty can be demanded; (ii) whether the SSI concession can be denied in this case by holding that the brand name owned by another person has been used by another person. 6. The issue whether assembling various components of computer include computer system amounts to manufacture has been examined by the Tribunal in a recent decision vide Final Order No.20197-20198/2017 dated 6.2.2017 in the case of Lampo Computers Pvt. Ltd., in which it has been held that such activity will not amount to manufacture. In the above decision, the Tribunal has held as follows: "6.1 At the outset, we examine the question whether putting together various components of computers and assembling the sam....

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....nts or an analogue machine with digital elements. (b) Automatic data processing machines may be in the form of systems consisting of a variable number of separate units. Subject to paragraph (e) below, a unit is to be regarded as being a part of a complete system if it meets all of the following conditions: (i) It is of a kind solely or principally used in an automatic data processing system; (ii) It is connectable to the central processing unit either directly or through one or more other units; and (iii) It is able to accept or deliver data in a form (codes or signals) which can be used by the system. (c) Separately presented units of an automatic data processing machine are to be classified in heading 84.71. (d) Printers, ke....

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.... 6.3 With the above background, we examine the question whether any new product come into existence by assembly of various components to form the computer system. We note that all units of an ADP are designed to be interconnected to enable the ADP system to be formed to carry out its function. It cannot be said that the assembly of various units into a working system has brought about any new goods which have a distinct name, character or use different from that of the units of computer system. This has been laid down as the test for manufacture by the Apex Court in the DCM case. Further we note that each of the components bought out by the assessee is separately duty paid. Though the Revenue has not gathered specific evidence of assembly ....