TaxTMI 
TaxTMI 
2017 (10) TMI 10
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....Excise duty liability on their manufacture, Central Excise officers visited their premises and made enquiries and recorded the statement of Shri Mohan Lal Sharma, partner of M/s O.P. Builders. (iii) It was revealed that firstly, the bridge and parts thereof are manufactured, at the appellant firm's workshops. The complete bridge sections are erected at the factory premises for the inspection of the concerned customer Govt. department; thereafter the steel bridge sections are dismantled and are taken to the site where bridge is to be fixed. Later, installation/erection of the bridge so manufactured is done at the specified site over abutments with the help of cement concrete civil work. (iv) The construction of such bridge sections involved purchasing of required raw materials like steel plates, channels, iron rods, angles etc. Thereafter, measuring, cutting, drilling, welding, riveting and assembling of these pieces are done to form bridge sections having a separate identity and distinct classification under Central Excise Tariff Heading 7308.10, thus constituting the process of 'manufacture' as per Section 2(f) of Central Excise Act, 1944. (v) Therefore, these appellants ....
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....s in their movable state will be subject to excise duty under Heading 7308, notwithstanding their getting permanently fixed in the structures. Further it also held that the plates rods, angles, shapes, sections, tubes and the like prepared for use in structures of the types covered under the Heading 7308 will also be excisable goods subject to duty in their pre-assembled or disassembled state. 6.1 The Larger Bench of the Tribunal in the case of Mahindra & Mahindra (supra) heard the group of appeals for similar matters afresh in view of the remand order made by the Constitution Bench of the Hon'ble Supreme Court. The question for decision before the Larger Bench of the Tribunal in this case was: "Whether : (a) making of structures and parts of structures of the types illustrated in the parenthesis of Heading 73.08 of iron or steel, (b) making of plates, rods, angles, shapes, sections, tubes and the like, as articles prepared for use in structures of iron or steel, would amount to manufacture of excisable goods classifiable under Heading 73.08" 6.2 With reference to above question which is relevant for the present appeals, the Larger Bench inter alia obs....
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....ently fixed in the structure. The liability to pay duty, that had arisen at the time when they were manufactured as parts of structures had, however, crystalised, and it was possible to ascertain the same even after they got fixed by referring to the quantities of the raw material that went into making them for the purpose of ascertaining their value. Therefore, any enquiry into the raw material used was only for the purpose of ascertaining the value of the parts of the structures which were already fabricated at the site, and was not an enquiry for imposing excise duty on the raw material, i.e. members such as angles, plates, etc. It was an enquiry to ascertain the value of the parts of the structures which were fabricated such as trusses, ladders, doors, windows, columns, beams, rafters, glazing frames, crane girders, hoppers, bracings, gable runners, platform, hand-rails, gratings rails, walkways, stairs, gutter supports, ladders, railings, etc. We have already noted the contractual terms and the relevant statements which clearly indicate that the parts of the structure were first fabricated on the ground and thereafter they were used for erecting the designed structures. In our....
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.... such parts of structures can be used. When such parts of structures are required to be used in the structure which is to be erected for which they are prepared, the person ordering the raising of such structure, in our opinion, provides an adequate market for such goods. 13.1 Commodity character in the concept of marketable commodity is transitory relationship between the goods and the buyers. The goods during their passage, sometimes through several hands from the possession of the first into the possession of the last owner, are commodities, but, as soon as they have reached their economic destination in the hands of the ultimate consumer, they obviously cease to be marketable commodities and become "consumption goods" as opposed to the concept of "commodity". Differences in the marketability of commodities is phenomenon of a far reaching practical importance. Marketability of commodities has its own limitations. Marketability of goods is limited with respect to the persons to whom they can be sold. The owner of a commodity does not have the power to sell it to any person of his choice. The owner has no choice of selling his commodity to persons who have no requirement of it,....
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....l degree in the hands of every owner. Thus, the concept of marketability in the context of marketability of parts of steel structures of the above nature falling under Heading 73.08 cannot be viewed through a hawker's eye. Hawking in its traditional sense, where the hawker moves with the goods screaming for the attention of potential customers, cannot be applied to the marketability of such structures or parts of structures, unless the concept of hawking itself is widened to include "E-hawking". The customer in the context of such product is the person who places the order for fabrication of such parts of structure to be raised by entrusting the contract to the manufacturer of such structurals or by itself engages workers on job basis to get them manufactured. Such customers provide adequate marketability to the movable structures and parts of structures falling under heading 73.08 which remain excisable goods until they are permanently fixed to become part of some immovable structure. Therefore, in our opinion all the above items fall under Heading 73.08 are marketable commodities. 14. When a part of structure is prepared and disassembled, the members thereof will be angles, ro....