TaxTMI 
TaxTMI 
2025 (8) TMI 495
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....AKAN, MEMBER(TECHNICAL) Shri J. Mohanty & Ms. Shreya Mundhra, Advocates for the Appellant M/s.Popular Tyre Retreaders & Appellant Nos.(i) to (iv) above and NONE for Appellant Nos.(v) to (vii) above. Shri S.Dey, Authorized Representative for the Revenue ORDER Per : ASHOK JINDAL : All the appeals are having common issue, therefore, all are disposed of by a common order. 2. The facts of the case are that the appellants are engaged in the business of retreading of tyres. The retreading process is based on the concept of procuring the tread and having the retreader bond the tread to a buffed casing. The tyre is first inspected and buffed perfectly and applied with a coat of rubber cement. A thin layer of unvulcanized rubber compound called Bonding Gum is applied to this surface. Over this, the procured tread belt of the desired design and size is built. This assembly is subjected to heat and pressure inside a chamber, which cured the bonding gum, thus bonding the procured tread firmly to the tyre within specified time. 3. After amendment of Central Excise Tariff Act, w.e.f. 28.02.2005 providing retreading of tyre to be covered under Chapter sub-heading 4012, the app....
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....repair of motor vehicle. Further, the retreading process does not create a new product but restores and reconditions the existing tyre to its serviceable condition, which is essentially maintenance and repair. As such, the said activity performed for the motor vehicle is excluded from the definition of management, maintenance or repair and is not leviable to Service Tax. The ld.Advocate relied on the decision in the case of M/s.Kuttukaran Trading Ventures v. Commissioner of Central Excise [2014 (5) TMI 1023 - KERALA HIGH COURT], which has been affirmed by the Hon'ble Apex Court reported as 2015 (1) TMI 858 - SC ORDER. 6. The Ld. Counsel further submits that retreading activity amounts to manufacture under Central Excise Act, 1944 and is covered under Chapter sub-heading 4012 and cannot simultaneously be subject to Service Tax. He further submitted that without prejudice, the said activity is in the nature of works contract service, where only 30% of the consideration represents service component, and the balance 70% being material component is not liable to Service Tax. The service component is anyway not excisable to Service Tax in terms of the exclusion provided in the definit....
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....ayment of Service Tax under "Management, Maintenance and Repairs" on the ground that the retreaded tyres are the part of motor vehicle, therefore, it is excluded from levy of Service Tax. To support this contention, we find that the Ld.Counsel relied on the decision of M/s. Kuttukaran Trading Ventures (supra), wherein the Hon'ble High Court has held as under :- "The word exclusion apparently means excluding any maintenance or repair relating to a motor vehicle. A motor vehicle has several parts and if only a part of the motor vehicle requires maintenance or repair, can it be said that it is not maintenance or repair of a motor vehicle The motor vehicle in question has to be dismounted at some place either in the workshop of the appellant or in the workshop of any other person or even at the residence of the customer in order to effect repairs. Once a part is repaired and it is thereafter fitted to the motor vehicle, it will have the character of a motor vehicle, which can be used on road. It is not in dispute that if the motor vehicle was brought to the service centre of the appellant and they themselves had dismounted the engine and repaired it and then refitted it to the....
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....uced in Central Excise Tariff Act, 1985 w.e.f. 20.08.2005 wherein Chapter Heading 4012 has been introduced and the same is extracted hereinbelow for better appreciation of facts : 16. Admittedly, the activity of retreading of tyres i.e. retreaded Tyres finds place in Central Excise Tariff Act, 1985, in that circumstances, we have to find out whether it is excisable goods or not ? 17. Section 2(d) of Central Excise Act, 1944 defines excisable goods means goods specified in first schedule and second schedule of Central Excise Tariff Act, 1985 as being subject to a duty of excise including salt. The expression to that is for the purpose of this Clause "goods" includes any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable. Admittedly, Retreaded Tyres qualifies as goods as it is being sold for a consideration and is marketable. Therefore, if the same finds place in the Central Excise Tariff Act, 1985, the same is to be termed as "excisable goods", and retreaded tyres falls within the first schedule to the Central Excise Tariff Act, under Tariff Item No.4012. However, no rate of excise has be....
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....mal Sugar Complex [2020 (371) E.L.T. 501 (Del.)] wherein the Hon'ble High Court has observed as under: - "46. The first decision, to which reference requires to be made, is the judgment of the Supreme Court in Solaris Chemtech Ltd., on which extensive reliance has been placed by the High Court in Gularia Chini Mills, for the proposition that electricity/electrical energy did not constitute "excisable goods". In Solaris Chemtech Ltd., the respondent-assessee - hereinafter referred to as "Solaris" - was using Low Sulphur Heavy Stock (LSHS) and furnace oil to generate electricity, which was captively consumed for manufacture of final products such as caustic soda and cement. Solaris desired to avail Modvat credit, under Rule 57A of the Central Excise Rules, 1944, of the duty paid on the furnace oil and LSHS. For this purpose, reliance was placed, by Solaris, on clause (c) in the Explanation to Rule 57A(1), which was inserted vide Notification No. 4/94, dated 1st March, 1994, which included, in "inputs", "inputs used as fuel". Solaris contended that LSHS was eligible to be regarded as "inputs used as fuel". The Revenue contended, per contra, that LSHS was used for manufacturin....
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....laced by Cenvat credit with effect from the said date. The position in the Tariff, as it existed during the period to which Solaris Chemtech Ltd. related is, therefore, not known. It is also to be borne in mind that the Explanation, to Section 2(d) of the Act, whereby goods which were bought and sold were, ipso facto, deemed to be marketable, was introduced only w.e.f. 10 th May, 2008. Prior thereto, it was necessary to establish, as an independent fact, the "marketability" of any item, in order to regard it as "excisable". Inasmuch as the judgment in Solaris Chemtech Ltd. was itself rendered prior to the addition of the Explanation to Section 2(d) of the Act, and the period of dispute, in the said case, was prior to 1st April, 2000, it is doubtful whether the "clarification", in the opening sentence of Para 8 of the report in the said decision, that "electricity is not an excisable item" could operate as a precedent, for all times to come, under Article 141 of the Constitution of India. 49. We are, of course, aware of the fact that, in Gularia Chini Mills, the High Court expressly rejected the specific contention, advanced before it, that the insertion of the Explanation ....
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.... 16. We take note of the fact that electricity finds place in the Tariff Item No. 2716 0000 of the Central Excise Tariff Act, 1985 and is "goods" as per Explanation to Section 2(d) of the Central Excise Act, 1944. Therefore, we hold that electricity is "excisable goods" and although the rate of duty column is kept blank, it cannot be said that it is not "excisable goods"." 19. Admittedly in this case the retreaded tyres find place in Tariff Item No.4012 of Central Excise Tariff Act, 1985 and is goods as per explanation to section 2(d) of the Central Excise Act, 1944, therefore, we hold that the retreaded tyre is excisable goods although the rate of duty column is blank, therefore, it cannot be said that it is not excisable goods. 20. In view of the above observation, we hold that it is an excisable goods and not a service. 21. We further take note of the fact that in the case of P. Cheriyan v. Mst. Barti Devi [1979 (4) ELT 593 (SC)] held that retreading of old tyres does not amount to manufacture in terms of section 2(f) of the Central Excise and Salt Act, 1944. We do agree with the observation made by the Hon'ble Apex Court in the case of P. Cheriyan v. Mst. Barti Devi (....