TaxTMI 
TaxTMI 
2022 (11) TMI 43
X X X X Extracts X X X X
X X X X Extracts X X X X
....river scheme for generation of hydroelectric power on the river Alaknanda in Chamauli Distict in the State of Uttarakhand. The project envisages the construction of a 15 meter high and 60 meter long barrage across the river Alaknanda. The construction and erection of various gates of the diversion barrage had to take place. Various duty paid iron and steel items were brought to the petitioner's workshop situated at Rewa. That, the said iron and steel items would be sent to the workshop and at the workshop, the various gates and other items were being prepared. That all these are required for the purpose of erection of the said project. That all these materials were purchased by the petitioner from the respective manufacturers and also from the open market. After purchase they are sent to the site at Rewa. The appropriate Central Excise duty on the said items purchased were already paid. The said fact is not disputed. The dispute was with regard to the different iron and steel items such as plates, angles, channels, beams etc., which were first brought to the petitioner's workshop and are then subjected in the said workshop for activities of cutting, bending, welding, drilling etc.,....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ioner. Shri S. Aole, Adv. for the respondents. Petitioner has sought following reliefs:- "1. A writ and/or Order and/or direction in the nature of mandamus commanding the respondents not to levy/demand any Central Excise duty on the iron and steel items cleared from the petitioner's said workshop for being used at Vishnuprayag Hydroelectric Project and Omkareshwar Project and to act according to law. 2. A writ of and/or Order and/or direction in the nature of prohibition commanding the respondents to forebear from levying /demanding any Central Excise duty on the said iron and steel items cleared from the petitioner's said workshop for use at the said Vishnuprayag Hydroelectric Project and Omkareshwar Project. 3. Such other or further order or orders be made and/or directions be given as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case." Learned counsel for the petitioner submitted that the petitioner has been awarded a Turnkey contract relating to Vishnuprayag Hydroelectric and Omkareshwar Power Project, wherein petitioner has to supply fabricated iron gates etc. The raw material for fabrication of the iron gates etc. are Excise ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....l Products Ltd. vs. Union of India (1998) 98 ELT 334. At this juncture, the learned counsel for the petitioner submitted that the representation is pending before the Deputy Commissioner, Central Excise Division, Satna. It is also contended by him that he would also submit further representation to the Commissioner, Customs and Central Excise, Bhopal, who can really take a decision in the matter with regard to imposition of Excise duty on the material in issue. If a representation is submitted within a period of two months from today, the same shall be dealt with by the respondent No.1 within a period of two months therefrom. It would be open to the petitioner to file necessary documents as well as notice to the respondent No.1 so that he can take sound decision which shall be informed by reasons. Till the matter is finally decided by the said authority order dated 28.02.2005 passed by this Court shall remain in force. Thereafter if any order is passed which would give rise to any grievance of the petitioner, the said order shall be kept in abeyance for a period of four weeks so that he can approach the appropriate legal forum. The writ petition stands disposed of in the above t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of Thungabhadra Steel Products Ltd. Vs. Union of India reported in 1998 (98) ELT 334 was concerned with the very question of fact and law. By the said judgment, it was held that assembling of fabricated parts into a whole structure at customers' site are not goods attracting levy of excise duty. The said order was challenged by the Commissioner, Customs before the Hon'ble Supreme Court by filing Special Leave Petition (Civil) No.4743 of 1998 (Union of India v. Thungabhadra Steel Products Ltd.) wherein the SLP was dismissed by the Hon'ble Supreme Court. The said fact is not disputed by the respondents. 4.(b) Reliance is also placed on the judgment of the CESTAT in the case of KPC Limited Vs. Commissioner of Central Excise, Guntur reported in 2004 (168) ELT 325, wherein a similar view was taken by the Tribunal by relying on the judgment of Thungabhadra Steel Products Ltd (supra). He has also relied upon the judgment of the Hon'ble Supreme Court in the case of Collector of Central Excise, Jaipur v. Man Structurals Ltd. reported in (2009)17 SCC 550, Orissa Bridge and Construction..v. Commissioner of Central Excise, Kolkata reported in 2002(146) ELT 84 [Tri Kolkata], Birla Vxl Ltd. v.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....The learned counsel for the petitioner on the other hand has filed a rejoinder. Learned counsel submits that the impugned order cannot be treated as an order in original. That, it is an order passed as a result of the direction issued by this Court in Writ Petition No.417 of 2005. It is a mere consideration of the representation of the petitioner. Therefore, since it is not an order in original it cannot form a subject matter of the appeal. He further contends that in terms of direction No.3, the Authority was directed to work out the excise liability on the goods. The same has not been done. Therefore, until and unless the adjudication takes place, there is no order which the petitioner can challenge. Hence, the contention of the respondents that the order is original cannot be accepted. 7. Heard learned counsels and perused the records. 8.(a) The reliance placed by the petitioner is on the Division Bench judgment of the High Court of Karnataka in the case Thungabhadra Steel Products Ltd. vs. Union of India & others reported in 1998 (98) ELT 334 KAR, wherein, the Court placed reliance on various judgments of the Hon'ble Supreme Court with regard to the test of marketability. The....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ar Sugar Mills Ltd. v. Union of India - (1968) 3 SCR 21 : AIR 1968 SC 922. (Emphasis supplied) "The Act charges duty on manufacture of goods. The word "manufacture" implies a change in the raw material but any change is not manufacture. There must be such a transformation that a new and different article must emerge having a distinctive name, character or use. The duty is levied on goods. As the Act does not define goods, the Legislature must be taken to have used that word in its ordinary, dictionary meaning. The dictionary meaning is that to become goods it must be something which can ordinarily come to the market to be bought and sold and is known to the market. That it would be such an article which would attract the Act was brought out in Delhi Cloth and General Mills Ltd's case (supra). (Emphasis supplied) 8. It is necessary in this connection to reiterate the basic fundamental principles of excise. The Judicial Committee of the Privy Council in Governor General in Council v. Province of Madras - 1945 FCR 179 at 192: AIR 1945 PC 98 at 101 observed that excise duty was primarily a duty on the production or manufacture of goods produced or manufactured within the coun....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... something more was to be done on the product to bring it into a form known to the commercial community, then it could not be treated as excisable goods. However, when the Tribunal over-ruled the decision of the Collector, the matter was ultimately taken to the Supreme Court. The Supreme Court, while allowing the appeal, observed thus : "The duty of excise is leviable under Entry 84 of List of the VIIth Schedule on goods manufactured, or produced. That is why the charge under section 3 of the Act is on all, "excisable goods' produced or manufactured". The expression 'excisable goods' has been defined by clause (d) of Section 2 to mean, 'goods' specified in the Schedule. The Scheme in the Schedule is to divide the goods in two broad categoriesone, for which rates are mentioned under different entry and other the residuary. By this method all goods are excisable either under the specific or the residuary entry. The word 'goods' has not been defined in the Act. But, it has to be understood in the sense it has been used in Entry 84 of the Schedule. That is why Section 3 levies duty on all excisable goods mentioned in the Schedule provided they are produce....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o exhaust molasses of sugar. A general note placed on the record of the Tribunal by the appellants, who have patented the mono vertical crystalliser, described the function and manufacturing process. The mono vertical crystalliser is fixed on a solid RCC slab having a load bearing capacity of about 30 tonnes per sq. mt. It is assembled at site in different sections shown by the packing list given to customers with the invoices. This consists of bottom plates, tanks, coils, drive frames, supports, plates, distance places, cutters, cutter supports, tank ribs, distance plate angles, water tanks, coil extension pipes, loose bend angles, coils supports, railing stands, intermediate platforms, drive frame railings and flats, oil trough, worm wheels, shafts, housing, stirrer arms and support channels, pipes, floats, heaters, ladders, platforms, etc. The parts aforesaid are cleared from the premises of the appellants and the mono vertical crystalliser is assembled and erected at site. The process involves welding and gas cutting. Where the assembly and erection is done by the appellants welding rods, gases and the like are procured from the stores of the customer and the customer sends to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....le and were not known to the market as such. The "marketability" is thus essentially a question of fact to be decided in the facts of each case. There can be no generalisation. The fact that the goods are not in fact marketed is of no relevance. So long as the goods are marketable, they are goods for the purposes of Section 3. It is also not necessary that the goods in question should be generally available in the market. Even if the goods are available from only one source or from a specified market, it makes no difference so long as they are available for purchasers. Now, in the appeals before us, the fact that in Kerala these poles are manufactured by independent contractors who sell them to Kerala State Electricity Board itself shows that such poles do have a market. Even if there is only one purchaser of these articles, it must still be said that there is a market for these articles. The marketability of articles does not depend upon the number of purchasers nor is the market confined to the territorial limits of this country. The appellant's own case before the excise authorities and the C.E.G.A.T. was that these poles are manufactured by independent contractors from whom....